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.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZjVIG https://t.co/f6mraHu6zv
  • Technical analysis of charts aims to identify patterns and market trends by utilizing differing forms of technical chart types and other chart functions. Learn about the top three technical analysis tools here: https://t.co/KDjIjKWitK https://t.co/JMsJPQlQ3j
  • 🇳🇱 Consumer Confidence (SEP) Actual: -5 Previous: -6 https://www.dailyfx.com/economic-calendar#2021-09-22
  • A rough start to the week with the cryptocurrency market a sea of red with losses on either side of -10% a common sight.Get your market update from @nickcawley1 here:https://t.co/AUfuM9t7yw https://t.co/lU6HS7fHwr
  • RT @FxWestwater: Gold, Copper Forecast: XAU Eyes FOMC, Evergrande News Sends Copper Flying Link: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2021/09/22/Gold-Copper-Forecast-XAU-Eyes-FOMC-Evergrande-News-Sends-Copper-Flying.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https://t.co/x2sC…
  • Heads Up:🇳🇱 Consumer Confidence (SEP) due at 04:30 GMT (15min) Previous: -6 https://www.dailyfx.com/economic-calendar#2021-09-22
  • PBoC liquidity injection + reports that Evergrande will make its next onshore bond payment ($35.88-million on 23 Sept) is bolstering risk appetite here. Yet, there is still no word on the $83.53-million offshore bond payment also due Thursday. Over to you now, Jpow & Co. https://t.co/3an0K2d5T1
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here: https://t.co/t9FlspUVZz https://t.co/ewdevfzq9I
  • Bank of Japan: - Outlook highly uncertain amid Covid - Asset purchase outline unchanged - Cuts assessment of production - exports, production impacted by supply side constraints - BBG
  • Heads Up:🇯🇵 BoJ Interest Rate Decision due at 03:00 GMT (15min) Previous: -0.1% https://www.dailyfx.com/economic-calendar#2021-09-22
USD/JPY Rate Carves Bearish Series Amid Escalating US-China Trade War

USD/JPY Rate Carves Bearish Series Amid Escalating US-China Trade War

David Song, Strategist

Japanese Yen Talking Points

USD/JPY extends the decline from earlier this week as the escalating trade war between the United States and China drags on market sentiment, and recent price action raises the risk for a further decline in the exchange rate as it carves a fresh series of lower highs & lows.

Image of daily change for major currencies

USD/JPY Rate Carves Bearish Series Amid Escalating US-China Trade War

Image of daily change for USDJPY

USD/JPY struggles to hold its ground as U.S. President Donald Trump threatens to tack on another $200B in tariffs on Chinese imports, and the shift in risk appetite may keep the dollar-yen exchange rate under pressures especially as China vows to ‘forcefully’ retaliate.

Even though the Federal Open Market Committee (FOMC) appears to be on course to implement four rate-hikes in 2018, the weakening outlook for global trade may limit the central bank’s scope to adopt a more aggressive in normalizing monetary policy as it dampens the outlook for growth and inflation. Signs of increased turmoil is likely to keep dollar-yen under pressure as it weighs on interest rate expectations, and Chairman Jerome Powell & Co. may continue project a longer-run Fed Funds rate of 2.75% to 3.00% as the committee pledges to ‘assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective.’

As a result, the advance from the May-low (108.11) may continue to unravel as USD/JPY carves a fresh series of lower highs & lows, with the Relative Strength Index (RSI) at risk of flashing a bearish signal as it comes up against trendline support.

USD/JPY Daily Chart

Image of USDJPY daily chart
  • Lack of momentum to test the May-high (111.40) raises the risk for a larger pullback in USD/JPY, with the RSI at risk of threatening the bullish formation from earlier this year as the oscillator approaches trendline support.
  • Break/close below the 109.40 (50% retracement) to 110.00 (78.6% expansion) region opens up the Fibonacci overlap around 108.30 (61.8% retracement) to 108.40 (100% expansion), with the next region of interest coming in around 106.70 (38.2% retracement) to 107.20 (61.8% retracement).

For more in-depth analysis, check out the Q2 Forecast for the Japanese Yen

Interested in having a broader discussion on current market themes? Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

Image of DailyFX economic calendar

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2018.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

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

DISCLOSURES