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.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Oil - US Crude
Wall Street
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
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
More View more
Real Time News
  • The #Dollar has bottoming potential, but that is starting to lose weight as it fails to sustain any lift; next week could be a big one for #USD’s near-term outlook. Get your #currencies update from @PaulRobinsonFX here:
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:
  • I’d like to thank my followers, I just reached 5,000 which is quite a milestone for someone that isn’t a huge fan of the platform. Thank you all very much ❤️
  • Technology stocks continue to be a source of weakness for US equities, undermining risk appetite. Meanwhile, US-China tensions simmer beneath the surface creating uncertainty. Get your #equities update from @PeterHanksFX here:
  • There are many different types of forex orders, which traders use to manage their trades. While these may vary between different brokers, there tends to be several basic FX order types all brokers accept. Learn about different FX order types here:
  • Did you know a Doji candlestick signals market indecision and the potential for a change in direction. What are the top five types of Doji candlesticks? Find out:
  • #Oil prices saw a reprieve to the recent selling pressure but remain at risk while below downtrend resistance. Here are the levels that matter on the #WTI technical chart. Get your #commodities update from @MBForex here:
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here:
  • The growth-linked New Zealand Dollar may rise on the upcoming #RBNZ rate decision following rosy economic data. However, downside potential in the S&P 500 could offset $NZDUSD gains. Get your #currencies update from @ddubrovskyFX here:
  • It was a quiet week in Aussie as $AUDUSD put in its second consecutive week of indecision. But taking a more granular look highlights the potential for a reversal scenario. Get your #currencies update from @JStanleyFX here:
USD/JPY Clings to Bull Trend, Fed’s Evans Warns of Above Neutral Rate

USD/JPY Clings to Bull Trend, Fed’s Evans Warns of Above Neutral Rate

2018-10-12 16:00:00
David Song, Strategist

Japanese Yen Talking Points

The selloff in USD/JPY appears to have stalled ahead of the weekend as the exchange rate holds a narrow range, and dollar-yen may exhibit a bullish behavior over the coming days as it clings to the upward trend from earlier this year.

Image of daily change for major currencies

USD/JPY Clings to Bull Trend, Fed’s Evans Warns of Above Neutral Rate

Image of daily change for usdjpy rate

USD/JPY bounces back from the monthly-low (111.84) as the recent rout in risk appetite abates, and the broader themes surrounding foreign exchange markets may support dollar-yen throughout the remainder of the year as the Federal Reserve appears to be well on its way to implement higher borrowing-costs over the coming months.

Recent comments from Chicago Fed President Charles Evans, who rotates into the Federal Open Market Committee (FOMC) in 2019, suggest the central bank will continue to normalize monetary policy next year as ‘it’s time to readjust the policy stance, at least to neutral.’ In response to the ‘very strong economy,’ Mr. Evans warns that the FOMC could be forced to lift the benchmark interest rate ‘maybe 50 basis points above neutral,’ and a growing number of Fed officials may show a greater willingness to extend the hiking-cycle as FOMC largely fulfills its dual mandate for full-employment and price stability.

Image of fed fund futures

As a result, Chairman Jerome Powell and Co. may prepare U.S. households and businesses for an imminent rate-hike the next meeting in November, and Fed Fund Futures may continue to reflect expectations for a move in December as the central bank endorses a hawkish forward-guidance for monetary policy.

Keep in mind, the recent pickup in volatility spurred a material shift in retail interest, with the IG Client Sentiment Report still highlighting the change in sentiment as 45.2% of traders are net-long USD/JPY, with the ratio of traders short to long at 1.21 to 1.In fact, traders have remained net-short since September 13 when USD/JPY traded near the 111.20 region even though price has moved 0.6% higher since then.

Image of IG client sentiment for usdjpy

Moreover, the percentage of traders net-long is now its highest since September 20 when dollar-yen traded near the 112.50 area as the number of traders net-long is 10.6% higher than yesterday and 4.0% higher from last week, while the number of traders net-short is 14.8% lower than yesterday and 25.5% lower from last week.

The skew in retail position may continue to offer a contrarian view to crowd sentiment as USD/JPY clings to the upward trend from earlier this year, with recent developments in the Relative Strength Index (RSI) also presenting a constructive outlook for dollar-yen as the oscillator reverses course ahead of oversold territory. Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

USD/JPY Daily Chart

Image of usdjpy daily chart
  • The failed attempts to break/close below the 111.10 (61.8% expansion) to 111.80 (23.6% expansion) area keeps USD/JPY within the upward trending channel from August, but need a move back above the 112.40 (61.8% retracement) to 113.00 (38.2% expansion) region to bring the topside targets back on the radar.
  • Next region of interest comes in around 113.80 (23.6% expansion) to 114.30 (23.6% retracement) followed by the 115.10 (61.8% expansion) hurdle.

For more in-depth analysis, check out the Q4 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!

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.