We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bullish
Oil - US Crude
Bearish
Bitcoin
Bearish
More View more
Real Time News
  • The $AUD is pressuring four-month trend support against its US counterpart as sellers fight to reassert the dominant, long-term downtrend. Get your market update from @IlyaSpivak here:https://t.co/Bup64Arva9 https://t.co/CpraRXneTJ
  • The British Pound may fall as #Brexit commences, but will the Bank of England cut rates? The US Dollar could rise if the Fed spooks markets with plans to unwind repo operations $GBPUSD #BoE #GBP #Sterling - https://www.dailyfx.com/forex/fundamental/forecast/weekly/gbp/2020/01/26/British-Pound-May-Yet-Fall-on-Brexit-BoE-and-Fed-Are-Risks.html?CHID=9&QPID=917702 https://t.co/v39NsmOCwa
  • Central bank independence has several advantages and disadvantages. Find out what they are in-depth with @MartinSEssex here: https://t.co/wVFXbbTxf1 https://t.co/5VQdkbIqTo
  • Last week was more of the same, a narrowing range following the UK general election fireworks; GBP/USD has a couple of clear signposts to keep an eye on. Get your $GBPUSD technical analysis from @PaulRobinsonFX here: https://t.co/3pJfj0w2AX https://t.co/Cm6zhnBSGR
  • The $AUD is pressuring four-month trend support against its US counterpart as sellers fight to reassert the dominant, long-term downtrend. Get your market update from @IlyaSpivak here: https://t.co/Bup64Arva9 https://t.co/OLpavqPOVA
  • RT @globaltimesnews: A total of 1,052 cases of #coronavirus have been reported as of Jan 25 in #Hubei Province, with 129 in critical condit…
  • RT @FactSet: $SPX is reporting revenue growth of 2.9% for Q4, led by the Health Care (11%), Utilities (9%), and Communication Services (9%)…
  • The AUD has been hit by the risk-appetite pullback occasioned by the spread of Wuhan-strain coronavirus. This week may see domestic focus return, if headlines allow, with key inflation data due. Get your $AUDUSD market update from @DavidCottleFX here: https://t.co/UIpwno0pSq https://t.co/kib4d1mA0q
  • RT @anilvohra69: USD inverted (red) is correlated to Excess Reserves (blue) and Reserve Balances (green). 1/2 https://t.co/bbO1pPWY4F
  • RT @FactSet: $SPX is reporting a decline in earnings of -1.9% for Q4, led by the Energy (-42%), Consumer Discretionary (-14%), and Material…
USD/JPY Decline to Eye August Low on Japan Trade Surplus, Dovish Fed

USD/JPY Decline to Eye August Low on Japan Trade Surplus, Dovish Fed

2015-10-16 21:39:00
David Song, Currency Strategist
Share:
USD/JPY Decline to Eye August Low on Japan Trade Surplus, Dovish FedUSD/JPY Decline to Eye August Low on Japan Trade Surplus, Dovish Fed

Fundamental Forecast for Yen:Bullish

The key event risks due out next week may heighten the appeal of the Japanese Yen and fuel a further decline in USD/JPY should the developments undermine speculation for a further expansion in the Bank of Japan’s (BoJ) asset-purchase program.

Despite bets for a larger quantitative/qualitative easing (QQE) program, a Trade Balance surplus may boost the outlook for the export-driven economy and keep the central bank on the sidelines as BoJ Governor Haruhiko Kuroda remains confident in achieving the 2% inflation goal over the policy horizon. At the same time, the BoJ may continue to tone down the verbal intervention on the low-yielding currency as the central bank head favors the exchange rate to move in a more stable manner, and we may get more of the same the next interest rate decision on October 30 as the board continues to see a moderate recovery ahead.

In contrast, the ongoing batch of mixed U.S. data prints may highlight a bearish outlook for the dollar and dampen the Fed’s scope to normalize monetary policy later this year as Governor Daniel Tarullo warns subdued wage growth accompanied by the global disinflationary environment does not warrant higher borrowing-costs. In turn, the speeches by Fed Governor Lael Brainard, Richmond Fed Jeffrey Lacker, New York Fed President William Dudley, Fed Governor Jerome Powell and Chair Janet Yellen scheduled for the week ahead may play a key role in dictating near-term price action for USD/JPY as market participants continue to weigh the timing of the liftoff.

As a result, positive data prints out of Japan coupled with dovish remarks from Fed officials may spur a further decline in USD/JPY as the pair fails to retain the range-bound price action carried over from September. With that said, the August low (116.07) sits on the radar, and the dollar-yen may continue to congest over the remainder of the year especially as the Relative Strength Index (RSI) largely preserves the bearish formation from June.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.