Skip to Content
News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

Free Trading Guides
Please try again

Live Webinar Events


Economic Calendar Events


Notify me about

Live Webinar Events
Economic Calendar Events






More View More
USD/JPY Searches for Near-Term Support as Risk Aversion Gathers Pace

USD/JPY Searches for Near-Term Support as Risk Aversion Gathers Pace

Talking Points:

- Larger USD/JPY Correction on Horizon as Risk Aversion Gathers Pace.

- GBP/USD Approaches Near-Term Resistance Ahead of 2Q U.K. GDP Report.

- USDOLLAR Fails to Benefit From Durable Goods Report- Bullish Formation at Risk.

For more updates, sign up for David's e-mail distribution list.


USD/JPY Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • USD/JPY may continue to give back the rebound from the monthly low (120.40) following the failed attempt to close above 124.30-40 (161.8% expansion), while market participants continue to scale back their appetite for risk amid the weakness in global equity prices.
  • Long-term outlook for USD/JPY remains bullish especially as the Bank of Japan (BoJ) continues to carry out its asset-purchase program, but the weakening outlook for global growth may drag on market sentiment and produce a further consolidation in the exchange rate until we see a further expansion in the global easing cycle.
  • DailyFX Speculative Sentiment Index (SSI) shows retail crowd remains net-long USD/JPY since June 8, with the ratio advancing to +1.95 as 66% of traders are now long.


GBP/USD Daily Chart
  • The failed attempts to close above 1.5450 (61.8% retracement) to 1.5460 (23.6% expansion) may produce a further consolidation in GBP/USD as it remains stuck in a wedge/triangle pattern; will keep a close eye on the advance U.K. Gross Domestic Product (GDP) report as the growth rate is expected to expand 0.7%.
  • Signs of stronger growth may encourage the Bank of England (BoE) to adopt a more hawkish tone at the August 6 interest rate decision; will keep a close eye on the vote count for signs of a growing dissent.
  • A dismal U.K. GDP print may dampen the appeal of the sterling and spur a test of the July low (1.5329) along with the Fibonacci overlap around 1.5330 (78.6% retracement) to 1.5350 (50% retracement).

Join DailyFX on Demand for Real-Time SSI Updates Across the Majors!

Read More:

Price & Time: What Is GBP Volume Telling Us?

The Weekly Volume Report: Sharp Move Lower in GBP OBV

USDOLLAR(Ticker: USDollar):

IndexLastHighLowDaily Change (%)Daily Range (% of ATR)
DJ-FXCM Dollar Index11991.5912042.4811984.07-0.38113.17%
USDOLLAR Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • Despite the better-than-expected U.S. Durable Goods Orders report, the Dow Jones-FXCM U.S. Dollar may continue to consolidate ahead of the Federal Reserve’s July 29 interest rate decision amid concerns surrounding the growth outlook as Non-Defense Capital Goods Orders excluding Aircrafts, a proxy for future business investments, showed an unexpected contraction in May.
  • Even though market participants continue to look for a September liftoff, Fed officials may show a unanimous vote to retain the current policy amid the disinflationary environment along with the slowdown in global growth.
  • Failure to hold above the Fibonacci overlap around 11,951 (38.2% expansion) to 11,965 (23.6% retracement) may bring up former resistance around 11,898 (50% retracement) to 11,901 (78.6% expansion).

Join DailyFX on Demand for Real-Time SSI Updates!

--- Written by David Song, Currency Analyst

To contact David, e-mail Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Trade Alongsidethe DailyFX Team on DailyFX on Demand

Looking to use the DailyFX Trade Signals LIVE? Check out Mirror Trader.

New to FX? Watch this Video

Join us to discuss the outlook for the major currencies on the DailyFXForums

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