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WHAT HAPPENED WITH JPY?Hello guys! Here is a quick summary of what happened in the market today, especially in the Japanese one, after the Bank of Japan surprised everyone. On Tuesday, the Bank of Japan made its first move towards a shift away from ultra-loose monetary policy after weeks of speculation. As part of an adjustment to its yield curve control policy, the BoJ decided to increase the range of its target for the yield on 10-year government bonds from +/- 25 basis points to +/- 50 basis points. Despite this change, the Bank kept its short-term policy rate at -0.1% and maintained its commitment to easing in its statement. In fact, the BoJ plans to increase its purchases of Japanese government bonds in the coming quarter, from 7.3 trillion yen per month to 9 trillion yen. The Bank of Japan's policy adjustment was more hawkish than financial markets had anticipated, and contributed to the yen's further recovery from a 30-year low reached this October. A stronger yen may provide some relief to the Japanese economy, which has been grappling with the high cost of imports due to the sharp decline in the value of the yen this year. As the possibility of more hawkish central bank actions and a potential recession in 2023 increased, the value of Asian currencies against the US dollar decreased further and risk appetite remained low. While the US dollar strengthened against most Asian currencies, the strength of the yen, euro, and pound weighed on the dollar index and dollar index futures. What do you think about the BoJ's move? FX:USDJPY FX:USDJPY BMFBOVESPA:JPY1! PEPPERSTONE:JPYX
Short
by m_maia14
4
Japanese yen edges lowerThe Japanese yen continues to have a quiet week. USD/JPY has edged up 0.20% and is trading at 132.50. There is optimism in the air ahead of the US inflation report for December. The forecast is for inflation to fall, which is exactly what investors want to hear. The consensus for headline inflation stands at 6.5%, following the November gain of 7.1%. The core rate is also expected to ease, with a forecast of 5.7% in December, compared to 6.0% in November. We've seen in recent months how inflation reports can move the equity and currency markets and investors should be prepared for the same from tomorrow's inflation report. Soft inflation releases have sent the US dollar lower, as the markets have assumed that the Fed will ease up on the pace of rates and even cuts rates late in the year. The Fed continues to present a hawkish stance, but the markets will likely march to their own tune if inflation comes in as expected or drops even lower. The markets have priced in a peak fed funds rate of 4.93%, lower than the Fed dot plot which projects rates peaking at 5-5.25%. Some Fed members have said rates could go even higher than that, but that hasn't made much impression on the markets. The Bank of Japan meets next week, and investors will be watching carefully. The BoJ meetings are no longer sleepy affairs with little substance, as the markets saw in December when the BoJ stunned the markets by widening the yield curve control band. We're unlikely to get more fireworks at the upcoming meeting, but the BoJ's inflation forecasts will be significant. There have been reports that the BoJ may raise the forecasts for core inflation. This would be bullish for the yen as a higher inflation forecast would be a prerequisite for the BoJ normalizing policy. There is weak resistance at 132.13, followed by 133.30 131.25 and 130.60 are the next support lines
by OANDA
Is the Yen rally over?The truth is that I don't know if it's over or not. It certainly feels like the USDJPY pair is going a lot lower, given that the Fed is very close to pausing and cutting rates in 2023. Deflation has always benefited the Yen, which might be the case again. The BoJ took the best stance of all central banks, as they held rates low and provided liquidity when the global economy was slowing down and would very clearly go into a deep recession in 2023-2024. Eventually, rates elsewhere will go down, but rates in Japan will be pretty much the same (go down a lot less). Therefore, the JPY could outperform everyone else. However, there is a chance that USDJPY is about to bottom. It's very close to testing a key area; I think it will sweep the double bottom and bottom at the S3 monthly pivot. If there is going to be a bottom soon, that's where I expect it to be. If the USD is to bounce quickly, that's where I expect it. It feels too early for the dollar to collapse outright, and maybe we will get a mini inflation scare before we move properly into deflation. So this is my bullish scenario. Fall slightly below 130 and then slowly go back up. 135.8 is the first target, and if 138 is reclaimed, the next target is 145.
by BitcoinMacro
USD/JPY extends losses after BOJ SummaryThe Japanese yen continues to lose ground this week and is in negative territory on Wednesday. In the European session, USD/JPY is trading at 134.11, up 0.49%. Post-Christmas holiday trading remains thin, but USD/JPY has made steady gains and climbed 1% this week. The US dollar has recovered somewhat after last Tuesday's slide when it fell a staggering 3.8% after the BoJ widened its yield curve band. The move blindsided the markets, which had not expected any major policy moves prior to the end of Governor Kuroda's term in April. Investors were all ears as the BoJ released today the summary of opinions from last week's dramatic meeting. The summary of opinions showed that several of the nine board members said that the tweak to yield control was aimed at enhancing the current stimulus programme rather than ending it. This reiterated what Governor Kuroda stated in a press conference after the meeting. Still, speculation remains high that the BoJ could take further steps that tighten policy, and even exit the Bank's ultra-loose policy, especially with inflation running at a 40-year high. The summary of opinions indicated that members discussed rising inflation and the possibility that higher wages would remove the risk of a return to deflation. The BoJ has been focused on wages, arguing that strong wage growth will ensure that inflation is sustainable, as opposed to inflation that is driven by higher costs for energy and raw materials. The government is also making wages a top priority, and there are indications that major companies and labour unions will negotiate higher wages in the spring. If the BoJ sees that wages are rising it could raise its yield curve control target, which is currently around 0% for 10-year bonds. The BoJ will likely be back in the headlines shortly, with its next meeting on Jan. 17th and 18th. USD/JPY is testing resistance at 134.12. Above, there is resistance at 134.82 There is support at 133.25 and 132.29
by OANDA
Yen edges lower, Kuroda says no exit plannedWith most financial markets closed on Monday, trading will be thin. Japanese markets are open and USD/JPY has edged higher, trading at 132.82, up 0.34%. The Bank of Japan announced a policy change last week, and the ramifications were massive for the Japanese yen, as USD/JPY jumped as much as 4.8% following the move. The BoJ widened the yield curve on long-term bonds from 0.25% to 0.50% but maintained the yield target at 0%. The tweak to the yield curve caught the markets napping, and the shocking move now has the markets buzzing as to whether the BoJ is planning further policy changes to its ultra-low monetary policy. Investors heard from the man himself earlier today, as BoJ Governor Kuroda gave a speech where he stated that last week's move was not a prelude to withdrawing its massive stimulus programme. In fact, he said the widening of the yield curve would enhance the Bank's ultra-easy policy. Kuroda reiterated his well-worn theme that the BoJ wants to see wages rise in order to hit its 2% inflation target in a "sustainable and stable manner" and plans to continue monetary easing through yield curve control. The key question is whether the markets are buying what Kuroda is selling. Prior to last week, the markets were expecting an uneventful end to Kuroda's decade at the helm of the BoJ, which ends in April. That view has been turned upside down after the yield curve tweak, and I would expect the markets will be on guard for additional tightening moves, despite Kuroda's insistence that it is business as usual at the BoJ. Last week wrapped up with further signs that inflation is falling in the US. The Fed's preferred inflation gauge, the PCE Price Index for November dropped to 5.5% y/y, down from 6.1%. As well, UoM inflation expectations slowed to 4.4% y/y in December, down from 4.6% a month earlier. UoM Consumer Sentiment rose to 59.7, up from 59.1, as consumers are more confident about the economy.  Although there is evidence that inflation is easing, strong wage growth and a robust labour market likely mean that the Fed is unlikely to change its view that interest rates will rise above 5% before peaking. USD/JPY is testing resistance at 132.70. Above, there is resistance at 133.62 There is support at 131.72 and 130.15
by OANDA
Yen Pair Moves And The Right Market MindsetSo the Yen Pairs continued their move down.. But what can you take away from it? Well as it happens, there is a lot! 1) Markets will always have enormous swings one way or another. That is just simply the nature of anything that has value. Sometimes it will be VERY high, or VERY low. 2) Make sure you are going to remain solvent on an extreme move. 3)Understand that the Markets are not built for one Trade big wins. Its a process of taking lots of Trades over time with patience. So, you can see these factors from both the previous move and current one. Watch for more, aswell as my pre-determined entry/exit points. Trade Small and Trade Safe Always.
by WillSebastian
6
MFG: Long term strategyThis chart indicates a strong relation of MFG (generally applies to most bank stocks) with gov yield rates - 5 year Japanese bond in this case. Considering the chart pattern, there is still a possibility of testing a bottom for a couple of months, but the stock price should soon catch up with the yield rate. As the downside risk is limited, we may be seeing a great opportunity to accumulate and add these stocks to your portfolio for income gain. FRB started rasing the funds rate. This may continue for a couple of years and it is best to watch their monetary policy. The current inflation we are experiencing is worldwide and BOJ will follow FRB - FRB is running ahead of BOJ. FRB will tell you when to exit.
NYSE:MFGLong
by Tomatrader-X
2
USD/JPY rockets after BoJ shockerThe Japanese yen has sent the dollar tumbling on Tuesday. USD/JPY has fallen 3.26% and is trading at 132.44 in Europe. In the Asian session, USD/JPY fell as low as 131.99 but has recovered slightly. At the end of its policy meeting, the Bank of Japan stunned the markets with a change to its yield curve control (YCC). The BoJ announced it would widen the band around the 10-year bond yield to 50 basis points, up from 25 bp. The move allows long-term interest rates to rise higher and the reaction was deafening, as the yen soared and climbed to its highest level since August 11th. The move was completely unexpected, as the BoJ meeting was expected to be a sleeper with no policy changes. It was just yesterday that I wrote in these pages that the BoJ was not expected to change policy until the changing of the guard in April 2023, when Governor Kuroda steps down. The BoJ move is certainly dramatic but needs to be kept in proportion. The BoJ is maintaining its YCC targets and said it would sharply increase bond purchases. This could be a signal that the Bank is tweaking its current ultra-loose policy and is not planning to withdraw stimulus. The BOJ has staunchly defended its yield cap with massive bond purchases, and this has distorted the yield curve and fueled a sharp drop in the yen, which has contributed to higher costs for imports of raw materials. BoJ policy makers may have become uncomfortable with these side effects and felt that the time was right to take a small step towards normalisation. This 'baby step' packed a massive punch as seen in the yen's reaction, and the markets will be looking for hints at further moves from Governor Kuroda as his term winds down. USD/JPY has broken below several support levels. The next support level is 131.13
by OANDA
1
USD/JPY dips on possible policy tweakThe Japanese yen has started the week in positive territory. In the European session, USD/JPY is trading at 136.22, down 0.38%. The yen is coming off a busy week, as USD/JPY traded in a 350-point range but closed the week almost unchanged. The markets are keeping an eye on April 2023, when Bank of Japan Governor Kuroda retires and a new governor is appointed. This has raised speculation that the changing of the guard could lead to policy changes at the bank. There was a report today that the BoJ and the government could revise their decade-old statement, which pledges to achieve the 2% inflation target "at the earliest date possible". This has resulted in the BoJ maintaining its radical stimulus programme and keeping interest rates ultra-low, at a time when other major central banks are busy raising rates in order to curb inflation. This policy was initiated in 2013, when Japan's economy was marked by deflation. With consumer prices rising and a weak yen contributing to inflation, the statement could be out of date and the new BoJ governor may feel the timing is right to revise the statement, perhaps making the inflation target more flexible. There is rising speculation that the new governor could tweak yield curve control, which has kept a cap on 10-year Japan's government bonds and fueled the yen's sharp descent this year. For now, however, it is likely to be business as usual - the BoJ winds up a two-day meeting on Tuesday and is not expected to make any changes to monetary policy. USD/JPY is testing support at 136.48. This is followed by support at 134.78 There is resistance at 137.64 and 138.43
by OANDA
USD/JPY - China jitters propel yen higherAfter strong gains last week, the Japanese yen has extended its gains on Monday. USD/JPY is trading at 138.23 in the European session, down 0.67%. China has applied its Covid-zero policy with a heavy hand, but Covid cases continue to rise nonetheless. The mass lockdowns have triggered widespread protests, which some injuries reported. The unrest is likely to exacerbate supply-chain disruptions and dampen domestic demand, which has hurt risk appetite. This has resulted in flows to haven assets, such as the Japanese yen. USD/JPY dropped as much as 1% earlier today, but the dollar has managed to recover some of these losses. The yen also received a boost after Bank of Japan Governor Kuroda said that the tightening labour market will push wages higher. Kuroda has long insisted that rising inflation has driven by import costs and the weak yen and is transient. Higher wages would indicate that inflation is sustained, which could result in the BoJ making some changes in its ultra-loose policy. After a short trading week in the US due to the Thanksgiving holiday, the markets will have plenty of US events to digest this week. CB Consumer Confidence will be released on Tuesday, with the November report expected to dip to 100.0, down from 102.5. The key release of the week is nonfarm payrolls on Friday, which could have a major impact on the Fed's decision to raise rates by 50 or 75 basis points at the December 14th meeting. Currently, the likelihood of a 50-bp hike is about 75%, versus 25% for a larger 75-bp increase. Investors are viewing a 50-point move as a dovish pivot, which has been putting pressure on the US dollar. Still, even a 50-bp hike would set a record for yearly rate hikes of 4.25%. There is resistance at 139.82 and 141.58 There is support at 137.39 and 135.63
by OANDA
USD/JPY calm as inflation rises higherThe Japanese yen has edged higher on Friday and is trading at 139.90 in the European session. Inflation continues to creep up in Japan. Core CPI accelerated to 3.6% in October, up from 3.0% in September and edging above the consensus of 3.5%. These levels pale in comparison to what we're seeing in the US, the UK and elsewhere, but Japan hasn't seen these levels of inflation in 40 years. The country has a deflationary mindset, which leads firms to absorb higher costs for fear of losing customers. However, as inflation continues to move higher, that trend is changing and consumers are feeling the pain of higher prices. Despite rising inflation and a weak yen, the Bank of Japan is resolute in maintaining its ultra-loose policy in order to support the weak economy. The BoJ has been an outlier as it has capped interest rates while the global trend has been to raise rates, arguing that cost-push inflation is only temporary. BoJ Governor Kuroda has said that inflation should peak after hitting 3%. Kuroda might want to consult with Jerome Powell or Christine Lagarde about making assumptions about inflation peaks, as they found out to their chagrin that inflation was much stickier than they had anticipated. Ever since the last US inflation report sent the equity markets soaring and the US dollar sliding, the Fed has circled the wagons and telegraphed a hawkish message to the markets. The latest salvo came from Fed member Bullard, who urged the Fed to raise rates to 5%-5.25% at a minimum. Bullard also presented a hawkish scenario in which the funds rate would climb all the way to 7%, a message investors clearly didn't want to hear. Retail sales and unemployment claims were better than expected, another indication that the US economy remains resilient handle further rate hikes. The Fed's coordinated message and the solid data have quelled the stock market rally and boosted the US dollar. USD/JPY is testing support at 139.95. Below, there is support at 138.09 There is resistance at 141.01 and 142.87
by OANDA
1
$USDJPY: Weekly trend signal points to a steady advance$USDJPY has a new trend continuation signal here, weekly and daily trends are bullish, as well as monthly, quarterly and even yearly. Energy and bonds suggest we will see rising yields for longer, FX looks like the dollar has ample reasons to remain bid and the BOJ and ECB are the weakest central banks here, relatively vs the Fed's policy stance, as well as from a macro standpoint as energy importers facing an energy crunch, which is bound to be negative variable as well. I'm long $UUP calls and short $NZDUSD, adding some $USDJPY exposure here to remain exposed to the dollar trend. Cheers, Ivan Labrie.
Long
by IvanLabrie
9
USDJPYHello traders. I see a poin of interest here. Fundamentally speaking, Bank of Japan has initiated the intervention in order to mitigate the Yen 's depreciation. Technically speaking we are inside weekly supply zone which is not checked as support up to today. I see an M pattern forming in daily time frame. I see two potential entries. One immediate entry and another one if it goes up to test the highs. 142 price are is nice for take profits. Note: M patterns are not always symmetrical as a nice double top. it can include second high lower that the previous one because they do not want to release the late buyers who bought at the top. They want to grab their money. So, this is a reason I believe it may start selling from now. Anyhow, Friaday is NFP and it may cause volatility with USD spikes testing Key levels so I want to be safe by reducing the lot seriously and increasing the SL much higher. If the M is going to form a High> previous top, I will still consider it as a nice entry for short due to stop hunt routine for sellers. (M pattern not symmetrical again) Good luck!
Short
by The_Forex_Path
1
Yen extends rally as Japan's PPI easesThe Japanese yen is taking a breather after posting huge gains on Thursday. In the European session, USD/JPY is trading at 140.30, down 0.45%. The week wrapped up with a key inflation release. Japan's Producer Price Index slowed to 9.1% in October, down from 10.2% in September. Still, this was above the consensus of 8.8%. Consumer inflation is running around 3%, much lower than in other developed countries but high for Japan. The Bank of Japan has taken note of the rise in inflation but has said that it will not change its ultra-loose policy until it is convinced that inflation is not transient. The yen has fallen around 20% this year against the dollar but jumped on the bandwagon on Thursday after a soft US inflation report caused the dollar to plummet. Headline inflation dropped to 7.7%, down from 8.2% and core inflation dropped to 6.3%, down from 6.6%. Although inflation remains high, both indicators were lower than expected, which triggered a stampede as US stock markets soared and the US dollar was crushed. The soft inflation report has raised expectations that the Fed will ease up on the pace of tightening and will raise rates by "only" 50 basis points rather than 75 bp at the December meeting. According to Fed Watch, the markets had priced in a 50 basis point hike in December at 55% (45% for a 75 bp move) prior to the inflation release. This changed dramatically after the inflation release - currently, a 50 bp hike is priced in at 85%, with just 15% for a 75 bp move. Investors seem to be ignoring Fed Chair Powell's comment last week that the benchmark rate would peak at a higher level than previously expected, which could mean a terminal rate of 5.0% or even higher. The enthusiasm investors are showing could dampen if the upcoming employment and inflation reports point are stronger than expected. USD/JPY has support at 139.66 and 138.88 142.11 is the next resistance line
by OANDA
1
GBPJPY BUYHello traders. GBPJPY has performed a quite bullish price action. But the market makers' game is usually trapping the retailers on Mondays and reverse the trend later during week. So, I am sceptical. The pair definitely needs corrections and that is not only an opinion of mine. It is overbought so many big players will close their profits pretty soon. However, it remains bullish in technical analysis and GBP is bouncing from the lows while JPY keeps loosing value. Drawing Fib levels from the Swing Low to Swing High, based of the last 4H impulse move, I consider the below Fib retracement area as a great long opportunity. 163.585 - 166.057 Note: it is at a weekly Supply level but I see the potential to break it and aim for Multiyear highs. good luck
Long
by The_Forex_Path
Could the USDJPY reach 149 again?The USDJPY fell slightly overnight but continues to trade along the support area of 146.70. As the price consolidates but fails to trade lower from this support level, look for a recovery in the strength of the DXY, which could cause the USDJPY to rebound higher, toward the interim resistance 148 to 149 price area. However, if the price breaks below 146.00, the USDJPY could trade significantly lower toward the next key support and round number level of 145.00.
Long
by JinDao_Tai
Yen slips after BoJ holds the courseUSD/JPY has posted strong gains today. In the European session, the yen is trading at 147.42, up 0.78%. All eyes were on the Bank of Japan, which wrapped up a crucial 2-day policy meeting on Friday. The meeting came just days after Japan's Ministry of Finance (MOF) intervened in the currency markets after the yen had fallen close to the 152 line, a new 32-year low. Finance Minister Shunichi Suzuki would not confirm that the MOF had intervened for the second time in two months, but issued a blunt warning, declaring that the government was "facing off with speculators via markets." This set the stage for today's BOJ meeting. In the end, it was business as usual, as the Bank maintained ultra-low interest rates and kept its dovish guidance. The BoJ remains an outlier with its loose policy, as most other major central banks are tightening in order to curb inflation. What was noteworthy was that the central bank revised upwards its inflation forecast for fiscal 2023. Headline inflation was raised to 1.6%, up from 1.4% in July, and core inflation to 2.9%, up from 2.3% in July, with the BoJ warning that risks were skewed to the upside. The Bank also lowered its growth forecast for fiscal 2022 and 2023. Inflation has pushed above the BoJ's target of 2%, but BOJ Governor Kuroda has insisted that he will not consider tightening policy until it is clear that inflation is sustainable. There was a hint from the Bank that this may not be so far off, as today's BOJ quarterly report, noted that rising inflation is expected to "lead to sustained price rises accompanied by wage gains". The yen has paid the price for the BoJ's ultra-loose policy, tumbling some 20% against the dollar this year. With the BoJ making it clear that it won't be throwing any lifelines to the yen, the currency will be under pressure from the widening US/Japan rate differential, unless the MoF continues to intervene in the currency markets. USD/JPY faces resistance at 147.50 and 148.59 There is support at 145.23 and 143.14
by OANDA