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
Oil - US Crude
Bullish
Low
High
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 Australian Dollar remains vulnerable in the week ahead, eyeing risks such as a dovish RBA, surging Covid cases and recent crackdowns by Beijing. Might US NFPs offer some relief to AUD/USD? Get your weekly AUD forecast from @ddubrovskyFX here: https://t.co/LQzQymM3ND https://t.co/XOCJl3vbu1
  • $AUDNZD closed at its lowest since December 2020 Prices pierced the 1.0541 - 1.0564 support zone, exposing the November low at 1.0418 A confirmatory downside close under support next week may open the door to further losses #AUD #RBA https://t.co/mybbgPHNX4
  • 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 https://t.co/c51s3IBcEu https://t.co/k49UosZOUR
  • The US Dollar seems to be losing its momentum against ASEAN currencies as of late. Could this be another top in USD/SGD, USD/THB, USD/PHP and USD/IDR? Find out from @ddubrovskyFX here:https://t.co/rVBKBuhhAb https://t.co/lTT6oelIEc
  • 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/KDjIjLdTSk https://t.co/JTw3w7KYXP
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.10% 🇪🇺EUR: -0.15% 🇯🇵JPY: -0.18% 🇬🇧GBP: -0.39% 🇳🇿NZD: -0.56% 🇦🇺AUD: -0.69% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/a8XYJHybtN
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Silver: -0.05% Oil - US Crude: -0.25% Gold: -0.77% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/C66zBofenc
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.72%, while traders in France 40 are at opposite extremes with 71.64%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/6QmJTzlrho
  • Entry orders are a valuable tool in forex trading. Traders can strategize to come up with a great trading plan, but if they can’t execute that plan effectively, all their hard work might as well be thrown out. Learn how to place entry orders here: https://t.co/1mnOXUuBpt https://t.co/8PhqKCpyzf
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Wall Street: 0.03% France 40: 0.03% US 500: 0.02% FTSE 100: -0.06% Germany 30: -0.09% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Mkxtacawl4
USD/JPY Outlook: Delta Variant Offers Respite For Safe Haven Yen

USD/JPY Outlook: Delta Variant Offers Respite For Safe Haven Yen

Warren Venketas, Markets Writer

USD/JPY ANALYSIS

Advertisement

JAPANESE YEN FUNDAMENTAL BACKDROP

2021 has not been a phenomenal year for the Yen against the U.S. Dollar, but recent COVID-19 concerns regarding the Delta variant has given USD/JPY bears some hope (see chart below). The correlation between COVID-19 concerns as new cases (global) rise and Yen strength is quite evident from the chart. Should new cases continue to rise, we could see subsequent Yen strength.

covid-19 vs JPY

Source: Refinitiv

USD/JPY OPTION EXPIRY LATER TODAY

The below option expiry strikes could play a significant role today as traders may keep prices above the 110.00 level to close off positions in-the-money. As a general rule of thumb, when large option positions expire, prices tend to move in the direction of that specific strike.

FX options expire 10-am New York/3-pm London - Wednesday July 21

USD/JPY: 110.00-15 (1BLN), 110.50 (820M)

Source: Reuters

USD/JPY TECHNICAL ANALYSIS

USD/JPY Weekly Chart:

usd/jpy weekly chart

Chart prepared by Warren Venketas, IG

Price action has shown a pullback from 2021 highs in late June. This falls in line with the rising new COVID-19 cases as mentioned above. The retreat back below the long-term trendline resistance zone (black) could suggest additional Yen strength toward the 109.00 psychological level.

Both the MACD indicator and Relative Strength Index (RSI) provide bearish signals as highlighted in red and blue respectively. The RSI shows bearish divergence as prices increase while slowing upside momentum is reflected on the oscillator. Continuation of the recent pullback could ensue in the medium-term should COVID-19 continue on its current trajectory.

USD/JPY Daily Chart:

usd/jpy daily chart

Chart prepared by Warren Venketas, IG

After the break below the support trendline (yellow) in early July, USD/JPY bulls have not been able to push back against the reversal. Maintaining prices above 110.00 has been a struggle but with todays options expiries, it is possible this may be the case leading up to expiry. Post-expiry there may be a move downward toward the 38.2% Fibonacci level at 109.25 – Fibonacci taken from June 2015 high to June 2016 low.

From the bullish perspective, the recent swing high at 110.70 will serve as initial resistance however, this may be unlikely with the current fundamental backdrop.

IG CLIENT SENTIMENT INDICATING SHORT-TERM UPSIDE

IGCS shows retail traders are currently net short on USD/JPY, with 53% of traders currently holding short positions (as of this writing) and because we take a contrarian view at DailyFX, the suggestive bias is bullish.

--- Written by Warren Venketas for DailyFX.com

Contact and follow Warren on Twitter: @WVenketas

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

DISCLOSURES