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.

Free Trading Guides
EUR/USD
Mixed
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
GBP/USD
Bearish
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
USD/JPY
Bullish
Gold
Bullish
Oil - US Crude
Bullish
Bitcoin
Mixed
More View more
Real Time News
  • European Opening Calls From IG: #FTSE 7392 +0.53% #DAX 13346 +0.48% #CAC 5955 +0.60% #AEX 607 +0.74% #MIB 23509 +0.77% #IBEX 9622 +0.61% #STOXX 3754 +0.61%
  • Traders should know how to confidently approach, enter and exit both Bull or Bear markets. Need some insight into it? Get it from @nickcawley1 here: https://t.co/GhvvFrB3gz https://t.co/IbzSBk5Hb1
  • Join @DavidCottleFX 's #webinar at 3:00 AM ET/8:00 AM GMT for your weekly update on the top Asia Pacific market drivers that traders should watch this week. Register here: https://t.co/HNf3Axw8s5 https://t.co/iMMiza1J1d
  • Have you joined @DailyFX @facebook group yet? Discuss your #forex strategies and brush up on your skills with us here: https://t.co/jtY1G7g8yx https://t.co/im72E4Szmi
  • The Riksbank – the world’s oldest central bank - will exit its negative interest rate policy for the first time in known history as officials explore uncharted territory with unknown consequences. https://www.dailyfx.com/forex/fundamental/article/special_report/2019/12/16/Worlds-Oldest-Central-Bank-to-Exit-Negative-Rate-Policy-First.html
  • The Indonesian Rupiah, Malaysian Ringgit, Philippine Peso and Singapore Dollar may continue their rise against the US Dollar on global optimism amid a US-China trade deal #ASEAN #IDR #PHP #USD - https://www.dailyfx.com/forex/fundamental/article/special_report/2019/12/16/Indonesian-Rupiah-Malaysian-Ringgit-May-Rise-on-US-China-Deal.html?CHID=9&QPID=917702 https://t.co/GYaUYookwM
  • LIVE NOW: In this session, Currency Analyst @ZabelinDimitri will preview the upcoming week's main political themes and discuss their impact on financial markets. https://www.dailyfx.com/webinars/146770987
  • LIVE IN 30 MIN: In this session, Currency Analyst @ZabelinDimitri will preview the upcoming week's main political themes and discuss their impact on financial markets. https://www.dailyfx.com/webinars/146770987
  • How will the $JPY respond as the Bank of Japan appears to begin walking back from years of assuring the markets that ‘powerful monetary easing’ would be enough to stoke inflation? Get your market update from @DavidCottleFX here:https://t.co/ETZgk4xf5U https://t.co/ArTaaTninN
  • Join @ZabelinDimitri 's #webinar at 11:30 PM ET/4:30 AM GMT to find out how geopolitical risk will affect the markets in the week ahead. Register here: https://t.co/hsULxMNOtM https://t.co/dClnkF5vrD
USD/JPY Technical Analysis: Best 2-Week Run For JPY Since 1998

USD/JPY Technical Analysis: Best 2-Week Run For JPY Since 1998

2016-02-12 20:10:00
Tyler Yell, CMT, Currency Strategist
Share:

To See How FXCM’s Live Clients Are Positioned In FX & Equities Click Here Now

Talking Points:

  • USD/JPY Technical Strategy: New 14-Month Lows Favor Selling Rips
  • USD/JPY Upside Aligned With Risk Sentiment, Which Bounced Higher on Friday
  • JPY Remains Strongest G10 Currency As Risk Sentiment Sours

This week, USD/JPY broke down to the 110 handle with a low Thursday morning of 110.95. This level had not been seen since the Bank of Japan surprised markets on October 31, 2014 with a multiplied effort of Quantitative & Qualitative Easing that sent USDJPY toward 125 in rather short order. Now, with fear of lower growth around the world pushing central banks below zero trying to stimulate overall demand, the market and USD/JPY appears dependent on the development of a global recession or a resumption of risk-on.

It has been said that markets panic first, and panic later and that played out cleanly in the USD/JPY this week. The 2-week gain in JPY has been the highest since the 1998 Asian/Russian Crisis caused a massive carry trade unwind an a 5% drop in the US30. However, as markets test policy leaders, the lack of co-ordinated action with worry mounting could continue to see JPY strength without a word of intervention from the Bank of Japan. This development aligns nicely with our 2016 fundamental outlook.

Does A Short-Term Bounce Ahead?

USD/JPY Technical Analysis: Best 2-Week Run For JPY Since 1998

Month to date, JPY has strengthened across the board. Against the US Dollar, the JPY has strengthened ~6.5%, and a short-term bounce could be ahead. The highlighted oval where price bounced after Thursday morning’s low on the chart aligns with a large price channel that has framed price and the 61.8% retracement right below Thursday’s low at 110.80.

The upside zone in focus early next week will be the prior zone of support that recently broke. In new trending markets, old support can turn into new chart resistance, and that would put attention on the daily range of the price extreme in December 2014 of 115.75-117.75.

However, such a move higher is estimated to provide better levels to sell unless the dour fundamental outlook changes dramatically in the next few weeks.

Additionally, the US Dollar continues to be sold, which will likely limit the ability for USD/JPY to push higher in a sustainable fashion. What is ironic is that the US Dollar weakness is coming as the US Dollar is subject to the Federal Reserve’s admittance to questioning the effectiveness of negative interest rates, something the Bank of Japan initiated on January 29.

T.Y.

Interested In Learning the Traits of FXCM’s Successful Traders? If So, Click Here

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

DISCLOSURES

News & Analysis at your fingertips.