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
  • RT @BrendanFaganFx: 77 counterparties take $1.352 trillion at Fed's fixed-rate reverse repo $USD $DXY https://t.co/kjecsXvpVU
  • EUR/USD attempts to halt a five day decline as the Federal Reserve sticks to the sidelines. Get your market update from @DavidJSong here:https://t.co/ig9bGLj35i https://t.co/YPksmNdJLR
  • US Markit Composite PMI for September fell to 54.5 from 55.4, whereby the services and manufacturing figures fell to 54.4 and 60.5 respectively, both missing analyst estimates. Get your market update from @JMcQueenFX here:https://t.co/4lFZGRufsM https://t.co/DuPcQtaBz0
  • S&P 500, Nasdaq Rally After the Fed; 10 Year Yield to Two-Month-Highs https://www.dailyfx.com/forex/market_alert/2021/09/23/SPX-SPY-ES-SP500-Nasdaq-NQ-QQQ-Rally-After-the-Fed-10-Year-Yield-2-Month-High.html https://t.co/peftVleO0y
  • #Bitcoin Outlook: $BTCUSD Bounce From 40K, Fake-out or Shake-out? - https://t.co/ixsRMKgCom https://t.co/KDQv4wgfot
  • While JPY gets clobbered, CHF decides to turn a blind eye to yields $CHF https://t.co/MViWZiiPZ7
  • The surprise 100 basis point cut from the Turkish central bank (to 18%) generated the expected pressure for $USDTRY. That said, I don't think it was the market that decided the momentum should die out at 8.8000 again... https://t.co/4jmOPnzzK9
  • surprised that $NQ is holding up so well with what rates are doing. 10 year yield at a 2 month high, $Nasdaq still holding resistance at prior support https://t.co/UBWBxY2nFC
  • The S&P 500 has recovered all the ground it lost at the start of the week and the Dollar has slumped post FOMC and PMIs. DailyFX's @JohnKicklighter gives a brief overview of the market for Thursday! https://t.co/jihKB44ELn
  • https://t.co/lbNvVbQq4n
Japanese Yen Price Outlook: USD/JPY, AUD/JPY, CAD/JPY

Japanese Yen Price Outlook: USD/JPY, AUD/JPY, CAD/JPY

Rich Dvorak, Analyst

JAPANESE YEN FORECAST: USD/JPY PRICE ACTION PLUNGES LOWER AS AUD/JPY, CAD/JPY EXTEND RALLY

  • Japanese Yen has weakened broadly with the exception of its US Dollar peer
  • USD/JPY price action looks primed to continue facing downward pressure
  • AUD/JPY has advanced to fresh yearly highs and CAD/JPY could catch up
Advertisement

JPY price action has largely traded on its back foot for the last few months. Weakness across the Japanese Yen has broadly stemmed from its posturing as a top safe-haven currency. Demand for safe-haven currencies like the Yen has dissipated with market sentiment and trader risk appetite flourishing. The Yen has strengthened considerably against its US Dollar peer, however, as spot USD/JPY edges toward its lowest monthly close since October 2016.

USD/JPY PRICE CHART: DAILY TIME FRAME (26 JUN TO 30 DEC 2020)

USDJPY Price Chart Yen Technical Forecast

USD/JPY price action could continue to face selling pressure headed into the new year as US Dollar bears strongarm the major currency pair lower. The Dollar-Yen might look toward the 102.50-price level, which is underpinned by the March swing lows, as a potential area of technical support. The bottom Bollinger Band and month-to-date lows around the 103.00-handle seems to have provided a bit of buoyancy so far, but the negatively-sloped 20-day simple moving average looks to be a more dominant headwind. A bearish crossover on the MACD indicator also suggests that downward momentum is accelerating.

AUD/JPY PRICE CHART: DAILY TIME FRAME (04 SEP TO 30 DEC 2020)

AUDJPY Price Chart Yen Technical Forecast

AUD/JPY price action has advanced steadily since the early November swing low. The Aussie-Yen trades over 600-pips higher since then and is on pace to close 2020 at a year-to-date high. Although the relative strength index suggests AUD/JPY has entered ‘overbought’ territory, the bullish trend appears firmly intact. If volatility continues to bleed lower and sentiment stays upbeat, spot AUD/JPY could extend toward the 80.500-price level underscored by the April 2019 swing high. On the other hand, a return of risk aversion, which would likely correspond with a pullback across major stock indices, the Japanese Yen could catch a safe-haven bid and steer AUD/JPY lower. This scenario could bring the 50-day simple moving average into focus as a potential area of technical support.

CAD/JPY PRICE CHART: WEEKLY TIME FRAME (AUG 2018 30 DEC 2020)

CADJPY Price Chart Yen Technical Forecast

CAD/JPY price action has also gained ground largely owing to the theme of strength across commodity currencies and weakness across safe-havens. This ‘reflation trade’ looks likely to continue into the new year with stimulus and vaccine developments keeping markets optimistic. CAD/JPY has faced technical resistance around the 82.000-handle, but an ascending triangle pattern looks to have formed from a series of higher lows since March. As upward pressure builds, a breakout above this level could motivate bulls to propel CAD/JPY toward the 84.500-price level near 2019 and year-to-date highs. The direction of crude oil prices might serve as a potential bellwether as to where CAD/JPY heads next considering the strong positive correlation between the Canadian Dollar and crude oil.

-- Written by Rich Dvorak, Analyst for DailyFX.com

Connect with @RichDvorakFX on Twitter for real-time market insight

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

DISCLOSURES