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.



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
Please try again
More View more
Real Time News
  • Implementing a trading checklist is a vital part of the trading process because it helps traders to stay disciplined, stick to the trading plan, and builds confidence. Learn how to stick to the plan, stay disciplined, and use a checklist here:
  • This week has started with the recovery rally in risk assets stalled and the Dollar looking down multiple barrels of fundamental threat in monetary policy and debt politics. $EURUSD is well positioned as indicator 1.1650-1.1750
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here:
  • AUD/NZD, Could This be the Turnaround? - #AUDNZD chart on @TradingView
  • Another pleasure being on @ausbiztv with host @AusAndrewG talking about US indices, rising bond yields and $USDJPY Check out the full interview here! -
  • 🇦🇺 Retail Sales MoM Prel (AUG) Actual: -1.7% Previous: -2.7%
  • 🇨🇳 Industrial Profits (YTD) YoY (AUG) Actual: 49.5% Previous: 57.3%
  • (APAC Stocks Briefing) Dow Jones Gains as Nasdaq 100 Sinks, Crude Oil Boosts Energy Stocks. ASX 200 in Focus #DowJones #CrudeOil #NASDAQ #ASX200
  • 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:
  • Heads Up:🇨🇳 Industrial Profits (YTD) YoY (AUG) due at 01:30 GMT (15min) Previous: 57.3%
USD/JPY and GBP/JPY Outlooks - Strong Trends But Overbought Signals are Flashing

USD/JPY and GBP/JPY Outlooks - Strong Trends But Overbought Signals are Flashing

Nick Cawley, Strategist

USD/JPY and GBP/JPY Price, News and Analysis:

The US dollar has been the beneficiary of risk-off buying this week as equity markets turn lower, while heightened volatility in a few speculative stocks has also sent investors into the relative security of the greenback. While the Japanese Yen is also seen as a haven in times of turbulence, the US dollar remains the go-to currency when markets turn volatile.

For all market-moving economic data and events, see the DailyFX Calendar.

The recent pick-up in USD/JPY has turned the daily chart bullish with the pair making a confirmed break above both the 20- and 50-day simple moving averages. The series of lower from mid-last year also looks to have been broken, while a trade above 105.70 will see the series of lower highs also broken, confirming a positive turn around in the pair. The recent rally has placed the pair into heavily overbought territory and this indicator may need to turn lower before the recent rally can continue.

USD/JPY Daily Price Chart (February 2020 – January 29, 2021)

USD/JPY and GBP/JPY Outlooks - Strong Trends But Overbought Signals are Flashing

IG Retail trader data show 52.53% of traders are net-long with the ratio of traders long to short at 1.11 to 1. We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USD/JPY prices may continue to fall.Positioning is more net-long than yesterday but less net-long from last week. The combination of current sentiment and recent changes gives us a further mixed USD/JPY trading bias.

GBP/JPYcontinues its slow grind higher and hit a near one-year high this week when it took out the old September 1 high. The technical set-up remains positive and Sterling as a currency is getting a small boost from the UK government’s vaccination program which has seen around 7.5 million first jabs already administered.

The daily chart shows the strength of the moving averages over the past few months with the 20-day simple moving average (red line) providing strong support. The September 1 high was also taken out this week, leaving the late-February swing high just under 145.00 the first target ahead of the December 2019 high print of 147.96. As with USD/JPY, the pair look overbought using the CCI indicator.

Moving Averages (MA) Explained for Traders

GBP/JPY Daily Price Chart (December 2019 – January 29, 2021)

USD/JPY and GBP/JPY Outlooks - Strong Trends But Overbought Signals are Flashing

What is your view on the Japanese Yen – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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