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31 Aug 2015
USD/JPY in neutral at key level on 121 handle
FXStreet (Guatemala) - USD/JPY continues to stabilise after yesterday's open in Asia and as we progress through the US session the price remains within the vicinity of the downside on the 121 handle, supported by the 50 SMA on the hourly chart at 121.12.
The Yen should remain robust in times of uncertainty. There is also a great deal at stake in respect to data releases and the Fed, while China continues to lurk in the background and subsequent negative implications for Global growth weighs on USD/JPY and stocks.
USD/JPY and equity market correlation
The S&P 500 Sep futures are -0.70% with the index opening down 12 points today and is now currently -0.5% at time of writing. This follows the Shanghai composite that closed 2.5% and the Nikkei down more than 1%, while the FTSE was out, but the rest of the European bourses were also down, notably the Dax opening -0.9% - all Yen supportive
USD/JPY and key US data week
This week is all about the US data and lead up to the middle of the month FOMC two-day meeting with the Fed decision taking place in the 17th. As markets start to price in a potential rate hike again on the back of a hawkish weekend of Fed's Fisher and the Jackson Hole, the Yen may come under-demand as stocks continue to tail off. The Nonfarm Payrolls report at the end of the week is the key focus.
USD/JPY mixed technicals
USD/JPY is turning more neutral as it continues to consolidate the recent market turmoil and volatility in the Yen. The hourly chart represents a move bullish tone than longer dated sticks that are bearish-neutral the further you go out.
USD/JPY is in bullish territory having crossed above the 120.70 200 DMA. 125.84 is the upside target as June highs. 123.20/30 could be a tough resistance, May 25th highs on the commencing rally out of the 4.5 month sideways channel and also comes in the vicinity of the 50 DMA. To the downside, the key support level is 118.00/50. Daily MACD is highly negative and the price recently penetrated down through the weekly 50 SMA at 119.51. All in all a mixed outlook, although Stéphanie Aymes, Head of Technical Analysis at Societe Generale, sees a retest of 118.20 in USD/JPY as a likely outcome.
The Yen should remain robust in times of uncertainty. There is also a great deal at stake in respect to data releases and the Fed, while China continues to lurk in the background and subsequent negative implications for Global growth weighs on USD/JPY and stocks.
USD/JPY and equity market correlation
The S&P 500 Sep futures are -0.70% with the index opening down 12 points today and is now currently -0.5% at time of writing. This follows the Shanghai composite that closed 2.5% and the Nikkei down more than 1%, while the FTSE was out, but the rest of the European bourses were also down, notably the Dax opening -0.9% - all Yen supportive
USD/JPY and key US data week
This week is all about the US data and lead up to the middle of the month FOMC two-day meeting with the Fed decision taking place in the 17th. As markets start to price in a potential rate hike again on the back of a hawkish weekend of Fed's Fisher and the Jackson Hole, the Yen may come under-demand as stocks continue to tail off. The Nonfarm Payrolls report at the end of the week is the key focus.
USD/JPY mixed technicals
USD/JPY is turning more neutral as it continues to consolidate the recent market turmoil and volatility in the Yen. The hourly chart represents a move bullish tone than longer dated sticks that are bearish-neutral the further you go out.
USD/JPY is in bullish territory having crossed above the 120.70 200 DMA. 125.84 is the upside target as June highs. 123.20/30 could be a tough resistance, May 25th highs on the commencing rally out of the 4.5 month sideways channel and also comes in the vicinity of the 50 DMA. To the downside, the key support level is 118.00/50. Daily MACD is highly negative and the price recently penetrated down through the weekly 50 SMA at 119.51. All in all a mixed outlook, although Stéphanie Aymes, Head of Technical Analysis at Societe Generale, sees a retest of 118.20 in USD/JPY as a likely outcome.