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Yen VS Dollar; Trade with cautionGlobal financial markets are bracing for a possible Fed rate cut. Accordingly, forex markets have priced in the anticipated rate cut. September CPI data indicated US inflation is on course towards 2%; seems like the prevailing interest rates are working. Blackrock thinks the Fed will be cautious with a 25-bps rate cut as opposed to a 50-bps rate cut. There is also the remote possibility that the Fed will be cautious and maintain the rates. Ostensibly, it seems the markets have aggressively priced in a rate cut that has seen the dollar weaken against major currencies. Looking at cross Yen pairs, bearish momentum is dominant in Q3 OF 2024. However, we have seen price imbalance and price inefficiency across all Yen pairs that must be corrected. For this imbalance to be corrected, we require the US Dollar to rise. All factors held constant, retaining rates or cutting rates lesser than expected will spook the markets and we could see the dollar strengthen against the Yen and other major global currencies. Turning to the US Dollar index, we see a potential for further weakening before the index rises targeting 105 to 110 price levels.
by morrisgitau
USDJPY | Perspective for the new week | Follow-upAfter an 8-week break from USD/JPY, I’m excited to bring it back to our watchlist as we prepare for next week’s trading! Over the past 9 months, this pair has experienced major shifts—from early-year expectations of Japan's monetary policy changes to the dollar's surge mid-year and the USD/JPY oscillating around the 150 zone in October. Key drivers include Japan's inflation data, with the latest CPI rising 2.5% YoY in September. As market rumours of another intervention grow, what opportunities lie ahead? Let's explore the key levels, trends, and setups for the coming week. USDJPY Technical Analysis: As discussed in the video, the recent upward momentum is showing signs of easing, leaving room for a possible USD pullback. However, for a confirmed uptrend continuation, we need to see sustained trading above 150.000. Our detailed technical analysis focused on the current bullish market structure, with particular attention to the key level of 150.000, set as a pivotal point for the upcoming week. This level gains significance as a potential catalyst for a clear uptrend if buying pressure persists. The market's response to this level at the beginning of the new week will strongly influence the direction of price action in the days ahead. #JapanInflation #USDJPY #Yen #BoJ #FederalReserve #Forex #CurrencyTrading #EconomicAnalysis #MarketAnalysis #Investing #Finance
by darcsherry
USD/JPY Market Update: Key Levels and Long-Term ProjectionsUSD/JPY Market Update: Key Levels and Projections The USD/JPY pair is nearing significant resistance levels, with potential for a correction if price action encounters selling pressure. Here’s a concise analysis of the current market structure: Sell Zone: 152.713 - 151.934 - 150.814 This sell zone marks crucial resistance levels. If the pair closes above 152.713 on the daily time frame, the market could turn extremely bullish. However, within this zone, price could face significant resistance, triggering a pullback. Buy Zone: Below 139, 136.000, and 128.000 The buy zones are below 139, with key support levels around 136.000 and 128.000. These zones are expected to hold strong buying interest if a correction occurs, providing opportunities for a reversal back to the upside. Current Price Action At 149.540, USD/JPY is approaching the lower boundary of the sell zone. While momentum remains bullish, watch for potential reversals near resistance. COG: 144.438 The center of gravity (COG) at 144.438 is an important mid-level to watch. It could act as a pivot point in case of a price retracement, offering insight into the strength of the pullback. Key Levels: Resistance: 152.713 - 151.934 - 150.814 (Sell Zone). Support: Below 139, 136.000, 128.000 (Buy Zones). COG: 144.438. Outlook A breakout above 152.713 may drive further gains, while a correction toward 136.000 or below offers potential buying opportunities. Share your thoughts in the comments, and don’t forget to boost this post if you agree with my analysis.
by Gravity-Traders-Academy
JAPANESE YEN INDEXThe Japanese Yen index (JXY) has been on a long term bearish trend. Recent intervention by the BoJ has lifted the Yen. On the weekly charts, the Yen has broken a key level indicating a shift in order flow. Price is expected to push higher to mitigate supply zones. In the short term, we expect the Yen to decline before resuming the bullish move. Consequently, majority of cross Yen pairs will push higher as the Yen index moves lower. Thereafter we expect the Yen to strengthen possibly towards the end of 2024.
TVC:JXYLong
by morrisgitau
ICT Long setup on NZDJPY👋Hello Traders, Our 🖥️ AI system detected that there is an H1 or higher timeframe ICT Long setup in NZDJPY for session trade (a couple of hours) Here is a session trade idea (since it is near support surface, we should use small lot size) Please refer to the details Stop loss, Buy Zone,open for take profit. For more ideas, you are welcome to visit our profile in tradingview. Have a good day! Please give this post a like if you like this kind of simple idea, your feedback will bring our signal to next better level, thanks for support!
Long
by ICT_Trader_SB
2
BOJ capitulates spectacularly Shinichi Uchida, Deputy Governor of the Bank of Japan (BOJ), says the bank won’t hike interest rates when markets are unstable, delivering a clear message on what traders need to do to prevent them doing so again: create volatility. It’s an amazing statement, signalling the BOJ can and will be bullied by markets to avoid doing what is right for the Japanese economy. It’s an incredibly dovish admission, giving traders the green light to re-establish carry trades until the BOJ starts making noise about hiking rates again, or we see a major global economic downturn. The Yen is tumbling understandably. Adding to the dovish surprise, Uchida said the BOJ must maintain the degree of monetary easing for now and suggested the BOJ would not be behind the curve if it didn’t usher through rate hikes “at pace”. It’s a capitulation of the grandest scale, undoubtedly orchestrated to restore calm to financial markets. It was only just over a week ago the BPOJ hiked more than expected and provided a hawkish outlook on the monetary policy outlook. USD/JPY surges as carry trades established USD/JPY has surged back above resistance at 146.50 on Uchida’s remarks, putting a potential retest of the January 2023 uptrend in play. The formation is also yet to be completed, but the three-candle pattern looks like a morning star, adding to confidence that we may have seen the cyclical bottom. Should the price manage to remain above 146.50, consider buying with a stop below the level for protection. The intersection of the former uptrend and horizontal resistance at 148.80 is one potential trade target. Should that go, 149.70, 150.90 and 151.95 are the next upside levels of note. The downtrend in RSI (14) has been broken, signalling downside momentum may be ebbing. It has yet to be confirmed by MACD but looks trustworthy given the speed of the rebound. It’s not just bottoming patterns being seen in USD/JPY but also other pairs such as EUR/JPY and GBP/JPY. -- Written by David Scutt
Long
by WHSelfInvest
Yen Bulls Hedge Funds Reduce Short Bets with BOJ Intervention The Japanese Yen (JPY) has been a story of woe in 2024, weakening considerably against the US Dollar (USD) due to a widening interest rate gap between the two countries. However, a recent shift in sentiment is brewing, with hedge funds reducing their bearish bets on the Yen in a significant move. Hedge Funds Cut Short Bets on Yen in Historic Move According to data from the Commodity Futures Trading Commission (CFTC), leveraged funds reduced their net short positions on the Yen by a staggering 38,025 contracts during the week ending July 16th. This marks the largest single-week reduction in short positions since March 2011, highlighting a potential turning point in the Yen's fortunes. Despite this significant cutback, it's important to note that hedge funds remain net short on the Yen, holding a total of 76,588 short contracts. This indicates a cautious optimism, with some investors still hesitant to fully embrace a Yen rebound. Intervention and Policy Shifts Fuel Yen's Rise The retreat from short positions by hedge funds coincides with several developments that have bolstered the Yen. Most notably, the Japanese government is suspected of intervening in the currency market to support the Yen. Reports suggest that Japanese authorities spent a substantial JPY 5.64 trillion (approximately USD 35.8 billion) over two trading sessions to prop up the currency from near its weakest levels since the 1980s. This intervention likely played a significant role in halting the Yen's decline and triggering a rebound against the USD. Beyond intervention, the Yen has also benefited from shifting expectations regarding US monetary policy. The Federal Reserve, which has been raising interest rates aggressively to combat inflation, may be nearing the peak of its tightening cycle. Increased expectations of a potential Fed rate cut in September have narrowed the interest rate gap between the US and Japan, making the Yen a more attractive proposition for some investors. Trump's Comments Add Fuel to the Fire Adding another layer of intrigue to the Yen's recent strengthening are comments from former US President Donald Trump. Trump, known for his unorthodox views on currency valuations, has reportedly criticized the weakness of the Yen. While his influence on markets is less pronounced than when he held office, his comments may have added a touch of uncertainty for USD bulls, potentially encouraging some to reduce their long positions. A Tentative Rebound or a Long-Term Shift? The recent developments surrounding the Yen paint a complex picture. While the reduction in short positions and the Yen's rebound are positive signs, it's too early to declare a definitive reversal. The overall direction of the Yen will likely hinge on several factors, including: • Future Actions by the Bank of Japan (BOJ): The BOJ, unlike many central banks, has maintained its ultra-loose monetary policy. Any indication of a potential shift towards tighter monetary policy could further bolster the Yen. • The Trajectory of US Interest Rates: If the Fed continues with its aggressive rate hikes, the interest rate gap between the US and Japan will widen, putting downward pressure on the Yen. • Global Risk Sentiment: The Yen is often seen as a safe-haven currency. If global economic uncertainty increases, investors may flock to the Yen, driving its value up. Conclusion: A Yen in Flux The Yen's recent strengthening and the reduction in short positions by hedge funds represent a potential turning point. However, the future trajectory of the Yen remains uncertain, dependent on a confluence of factors. Investors should closely monitor developments in both the Japanese and US economies, as well as broader market sentiment, to gauge the Yen's long-term prospects.
by bryandowningqln
Yen's Sudden Strength: Is the Bank of Japan Back in Action?The recent dramatic rise of the Japanese yen has sent ripples through the financial world. Three sharp surges – on July 11th, 12th, and 17th – have fueled speculation that the Bank of Japan (BoJ) is once again intervening in currency markets. These interventions have resulted in a 4% appreciation of the yen against the US dollar, bringing it to ¥156 per dollar. This is a significant rise, especially considering the yen's plunge to 37-year lows earlier in July. While the BoJ hasn't explicitly confirmed its involvement, the timing and nature of the surges strongly suggest its influence. Central banks typically intervene in currency markets to achieve specific economic goals. In the case of Japan, the recent depreciation of the yen has become a cause for concern. A weaker yen makes imports more expensive, contributing to inflation. Additionally, it can destabilize financial markets and harm Japanese exporters who rely on a competitive exchange rate. Possible Reasons for Intervention: • Curbing Inflation: Japan has recently experienced a rise in inflation, exceeding the BoJ's target of 2%. A stronger yen makes imported goods cheaper, helping to ease inflationary pressures. • Supporting Exporters: A weaker yen can initially benefit exporters by making their products cheaper overseas. However, a persistently weak currency can erode profitability in the long run. By stabilizing the yen, the BoJ might be aiming to create a more predictable environment for Japanese exporters. • Signaling Resolve: The BoJ has maintained an ultra-loose monetary policy for years, keeping interest rates near zero. This policy has contributed to the yen's weakness. By intervening in the market, the BoJ might be sending a signal of its commitment to preventing further depreciation. Potential Challenges and Implications: • Market Backlash: Excessive intervention by the BoJ could be seen as manipulating the market. This could lead to a loss of confidence in the yen and potentially trigger counter-interventions by other central banks. • Limited Effectiveness: The effectiveness of currency intervention is often debated. While it can achieve short-term results, it's difficult to sustain a stronger yen in the long run if underlying economic fundamentals don't support it. • Impact on Global Markets: A stronger yen can have a ripple effect on global markets. It can make Japanese investments less attractive to foreign investors and potentially trigger capital outflows. Looking Ahead: The BoJ's recent actions have certainly bolstered the yen. However, it remains to be seen whether this can be sustained. The long-term trajectory of the yen will depend on various factors, including global economic conditions, interest rate policies, and investor sentiment. The BoJ might need to continue intervening if it wants to maintain a more stable exchange rate. However, it will have to tread carefully to avoid unintended consequences and potential market backlash. In conclusion, the recent surge in the yen's value has reignited the debate about currency intervention. While the BoJ's actions might provide some temporary relief, the long-term outlook for the yen remains uncertain. The future path of the Japanese economy and global financial conditions will ultimately determine the fate of the yen.
by bryandowningqln
1
Retail Traders Poised for Yen Rebound - Consider Shorting USDJPYI am writing to bring to your immediate attention a critical development in the forex market that could present a significant trading opportunity. As many of you are aware, the recent slide in the Japanese yen has been a point of concern. This depreciation has heightened the probability of Japan intervening in the market once more to stabilize its currency. Historical patterns suggest that such interventions can lead to rapid and substantial movements in the yen's value. Currently, it appears that retail traders are reloading their bets in anticipation of a rebound in the yen. This collective action underscores a growing sentiment that the yen is poised for a recovery, potentially driven by governmental measures to curb its decline. Given these circumstances, it may be prudent to consider positioning yourselves for this anticipated rebound. Specifically, shorting the USD/JPY could be a strategic move. By doing so, you could potentially capitalize on the yen's resurgence if Japan steps in to support its currency. I urge you to review your portfolios and assess the potential benefits of shorting USD/JPY in light of the current market dynamics. As always, ensure that any trading decisions are made with careful consideration and risk management. Stay vigilant and informed. The forex market is highly dynamic, and timely actions can make a significant difference.
Short
by bryandowningqln
GBPJPY LEVEL UPSimple design with projected potential support/resistance level which can be traded in both reversal setups of breakouts after consolidation if relevant price action, patterns, signals, setups, occur at them. For example: if a correction occurs towards the red where the price signals a potential turnaround, and after a climb towards the green and a descent towards the yellow and a consolidation period, maybe the yellow pops on the downside triggering a slide towards the cyan. Any other combinations of scenarios can be considered as long as the market provides signs that these levels are relevant and not just random generated (or both).
by nen
ICT Short setup GBPJPY, H4 timeframe, Swing trade👋Hello Traders, Our 🖥️ AI system detected that there is an H4 or higher timeframe ICT Short setup in GBPJPY for Swing trade. Please refer to the details Stop loss, FVG(Sell Zone),open for take profit. For more ideas, you are welcome to visit our profile in tradingview. Have a good day! Please give this post a like if you like this kind of simple idea, your feedback will bring our signal to next better level, thanks for support!
Short
by ICT_Trader_SB
USDJPY Short time bearishFor years now Yen has been weak and USDJPY Rose 11% in the last 5 months meaning the trend is bullish . FX:USDJPY Peaked at 160 area last month then we saw some selling pressure which drove the rate to 152 zone {Last year high} Price rejection since this month open from 158 means we have some selling pressure, Today after US GDP QoQ2 release USDJPY Dropped 900 points too. I would wait to get a favorable long entry points. Areas of focus 155, 152, lowest 150. Below that the bias turns bearish mid term.
by alonso780
Silent Samurai: Why Japan Keeps Mum on the Yen's Fate f JapanThe Japanese Yen has been on a rollercoaster ride recently, weakening against the US dollar. This has sparked concerns in Japan, but the government has remained tight-lipped on whether they've intervened to prop up the currency. This silence, some argue, is a strategic necessity in the face of a more dominant player: the US Federal Reserve. Traditionally, governments use currency intervention – buying or selling their own currency – to influence exchange rates. A weaker yen can benefit Japanese exporters by making their goods cheaper overseas. However, a rapidly depreciating yen can also lead to inflation, hurting Japanese consumers. So, why the silence from Japan? Here are some key reasons: • The Power of the Fed: The US Federal Reserve's monetary policy decisions have a massive impact on global currency markets. When the Fed raises interest rates, it strengthens the dollar as investors seek higher returns in US assets. This, in turn, weakens currencies like the yen. Japan's silence could be a way to acknowledge this reality. Publicly admitting intervention against the Fed's tightening stance might be seen as futile or even provocative. • Preserving Intervention Ammunition: Currency intervention is expensive. It depletes a country's foreign reserves and can be ineffective in the long run if underlying economic conditions don't improve. By staying silent, Japan might be trying to keep the markets guessing about potential intervention. This uncertainty itself can sometimes deter speculators from further weakening the yen, achieving some effect without actually spending reserves. • Signaling Commitment to Market Forces: Openly intervening can be seen as a lack of confidence in a market-driven exchange rate system. Japan might be prioritizing long-term economic stability by allowing the yen to find its natural level based on market forces, even if it's uncomfortable in the short term. • Focus on Broader Economic Policy: The yen's weakness is just one piece of a complex economic puzzle. Japan's government might be prioritizing other measures to stimulate the economy, such as fiscal spending or structural reforms. Addressing these underlying issues could have a more lasting impact on the currency than short-term intervention. However, the silence isn't without its critics. Some argue that a lack of transparency undermines market confidence. Additionally, if the yen weakens excessively, the Bank of Japan (BOJ) might be forced into raising interest rates, contradicting its current ultra-loose monetary policy. This could create unwelcome economic disruptions. What's Next for the Yen? The future of the yen hinges on several factors, including: • The Fed's Path: The pace and extent of the Fed's interest rate hikes will significantly influence the dollar-yen exchange rate. If the Fed slows down its tightening, the pressure on the yen could ease. • Japan's Economic Performance: A stronger Japanese economy with signs of inflation could naturally lead to a yen appreciation. • Intervention Decisions: While Japan might remain tight-lipped, any covert intervention could impact the market. The coming months will be crucial for the yen. The silence from Japanese authorities might be a calculated strategy, but its effectiveness remains to be seen. Only time will tell if Japan can navigate these choppy currency waters and achieve a stable yen without sacrificing its broader economic goals.
Long
by bryandowningqln
The Yen's Wobble: Bank of Japan in a Policy BindThe Bank of Japan (BOJ) finds itself caught in a precarious situation as it grapples with defending the weakening Japanese Yen (JPY). With global inflation on the rise and other central banks tightening monetary policy, the BOJ faces a difficult choice: intervene in the currency market or stick to its ultra-accommodative stance. The Yen's depreciation stems from a divergence in monetary policies between Japan and other major economies. The BOJ has stubbornly maintained an ultra-loose policy, keeping interest rates at a negative 0.1% for nearly eight years. This stands in stark contrast to the US Federal Reserve, which has begun raising rates to combat inflation. This difference in interest rates makes the US Dollar (USD) a more attractive asset for investors, leading to a decline in the Yen's value. A weakening Yen presents a double-edged sword for Japan. On the one hand, it benefits exporters by making their products cheaper in foreign markets. However, on the other hand, a weaker Yen translates to higher import costs, particularly for essential commodities like oil and gas, which are already experiencing price hikes due to global factors. This translates to a squeeze on Japanese consumers' wallets and fuels inflationary pressures domestically. The BOJ has a couple of options to address this dilemma. One option is to intervene directly in the foreign exchange market by selling US Dollars from its massive war chest of over $1.2 trillion worth of US Treasuries (as of February 2024 data). This intervention would theoretically raise the value of the Yen by increasing demand for it. However, such a move is not without its risks. Selling a significant amount of US Treasuries could cause their yields, or the interest rates investors receive for holding them, to spike. This could have a ripple effect on global financial markets, potentially destabilizing them. Furthermore, Japan's intervention might be seen as futile if the underlying cause, the policy divergence with other central banks, is not addressed. The effectiveness of currency intervention is often debated, with some economists arguing that it is a temporary solution at best. The other option for the BOJ is to raise interest rates. This would bring Japan more in line with other central banks and potentially make the Yen a more attractive asset for investors. However, the BOJ has been reluctant to raise rates for several reasons. One concern is that raising rates could derail Japan's fragile economic recovery. The country has struggled with deflation, or persistently falling prices, for decades, and raising rates could dampen economic activity. Additionally, many Japanese businesses and households have become accustomed to, and even dependent on, the low-interest-rate environment. Raising rates too quickly could lead to financial instability. The BOJ's decision to maintain negative interest rates at its April 26th meeting underscores this cautious approach. This decision, while expected by many analysts, further highlights the difficult balancing act the BOJ faces. The path forward for the BOJ remains uncertain. The bank may eventually be forced to raise interest rates as global inflationary pressures persist. However, the timing and pace of such hikes will be crucial. The BOJ needs to find a way to defend the Yen without jeopardizing the economic recovery or causing undue financial market volatility. This situation serves as a reminder of the complex challenges central banks face in a time of global economic uncertainty.
by bryandowningqln
Hedge Funds Bet on Yen Shorts as BOJ Reiterates InterventionHedge funds are betting big against the Japanese yen, driving short positions to their highest level since April 2022. This aggressive stance comes despite warnings from the Bank of Japan (BOJ) that it will intervene in the currency market again to defend the yen if necessary. The data, compiled by the Commodity Futures Trading Commission (CFTC), shows a surge in net-short yen positions held by leveraged funds. This indicates a strong belief that the yen will continue to weaken. The yen has been under pressure for months due to a widening gap between Japanese and U.S. interest rates. Why the Yen Short Bets? Several factors are contributing to the bearish sentiment on the yen: • Divergent Monetary Policy: The BOJ is maintaining its ultra-loose monetary policy, keeping interest rates near zero, while the U.S. Federal Reserve is aggressively raising rates to combat inflation. This interest rate differential makes yen-denominated assets less attractive to investors, weakening the currency. • Geopolitical Tensions: The ongoing war in Ukraine and heightened global uncertainty are driving investors towards safe-haven currencies like the U.S. dollar, further pressuring the yen. • Intervention Concerns: The BOJ's previous intervention in the currency market in September 2022 to weaken the dollar and strengthen the yen proved to be temporary. The market's perception is that the BOJ may not be able to sustain continued intervention efforts, leading to renewed weakness in the yen. Bank of Japan's Warning The BOJ has reiterated its commitment to defending the yen and warned of further intervention if deemed necessary. Governor Haruhiko Kuroda has emphasized the bank's resolve to maintain its current monetary policy stance, even as the yen weakens. However, analysts remain skeptical of the BOJ's ability to influence long-term currency trends, especially given the strong global forces pushing the yen lower. Potential Impacts The continued decline of the yen could have several consequences: • Imported Inflation: A weaker yen makes imports more expensive, potentially fueling inflation in Japan. • Corporate Profits: Export-oriented Japanese companies could benefit from a weaker yen as their products become more competitive globally. • Investor Confidence: Continued weakness in the yen could erode investor confidence in the Japanese economy. Looking Ahead The future path of the yen is uncertain. The BOJ's resolve and ability to defend the currency will be closely watched. The direction of U.S. monetary policy and global economic conditions will also play a key role. With substantial short bets placed by hedge funds, the yen remains vulnerable to further depreciation. The BOJ's warnings of intervention add another layer of complexity to the situation. The coming months will be crucial in determining the fate of the yen and its impact on the Japanese economy.
Long
by bryandowningqln