USD/JPY to recapture the 106 level on a break above 105.80

FXStreet Team FXStreet

USD/JPY is up this Tuesday, trading near a daily high of 105.73 as the market is cautiously optimistic ahead of Fed’s speakers and the presidential debate. The pair is biased higher and needs to break above 105.80 to accelerate the upmove, FXStreet’s Chief Analyst Valeria Bednarik briefs.

Key quotes

“The greenback remains under pressure against most major rivals, as investors maintain a cautiously optimistic stance ahead, amid hopes for a US coronavirus aid package and a Brexit trade deal. US Treasury yields ticked lower, ahead of a bunch of Fed’s speakers and the first US Presidential debate that will take place later in the day.”

“From a technical point of view, the USD/JPY pair is biased higher, although without enough strength. The 4-hour chart shows that technical indicators remain within positive levels, slowly grinding higher. Also, the pair is above its 20 and 100 SMA, which converge in the 105.40 price zone, while a mildly bearish 200 SMA caps advances around 105.80.”

“Beyond 105.80, the USD/JPY pair could accelerate north towards 106.25, the next relevant resistance level.”

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

GBP/USD remains offered; bears target 1.3600

GBP/USD now leaves behind part of its recent recovery and revisits the low 1.3600s at the beginning of the week. Indeed, Cable trades with a mild downward bias amid decent gains in the Greenback as investors remain wary of upcoming US data releases and the Jackson Hole event.

EUR/USD remains sidelined above 1.1650

EUR/USD trades on the defensive following the closing bell on Wall Street on Monday, hovering around the 1.1660 region and adding to Friday’s small decline. The pair’s pullback comes in response to an acceptable rebound in the US Dollar in a context of generalised caution ahead of key US data releases and Chair Warsh’s speech in Jackson Hole.

Gold poised to extend its bullish run

Gold surrenders part of its initial advance, although it keeps its bullish pace well and sound above the $4,600 mark per troy ounce on Monday. The precious metal’s move higher comes despite slight gains in the US Dollar and a modest pullback in US Treasury yields across the curve.

XRP surged 72%, but is the rally really about XRP?

Ripple (XRP) surged more than 72% in less than a week, its strongest rally since July 2025, as cryptocurrency prices broadly broke out. But the move has a problem: it may have little to do with XRP itself. The token's near-term rally appears to have been driven largely by a broader liquidity shift after the US Treasury expanded long-end bond buybacks, pulling yields lower and lifting risk assets.

Convulsion in credit markets

The United States government just posted a $432.3 billion deficit for July, the largest monthly shortfall since March of 2021. That single burst of red ink pushed the yeartodate deficit to $1.8 trillion, with two months still remaining in fiscal 2026. At this pace, Washington will soon wax nostalgic for the “good old days” when annual deficits were only $2 trillion.

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.