JPY news - page 11
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USD/JPY Technical Analysis: Buy on Breaks Above ¥106.30
The USD/JPY currency pair hovered around the ¥106 level, marking a high of ¥106.26 and a low of ¥105.83 during the Asian session.
The upbeat US housing market data released on Tuesday along with improved sentiment around Japanese stocks are among the factors supporting the US dollar.
Upside potential in the USD/JPY currency pair is capped by the 50-day moving average of ¥106.12 and then major channel top resistance at ¥106.30.Supports on the downside are seen at the 5-day moving average of ¥105.67, the July 18 low of ¥105.27 and the round level of ¥105.
Trade idea: Go long on a breakout above ¥106.30 with a stop loss at ¥105.65, targeting ¥106.80-¥107-¥107.90.
source
Japanese government considering 20 trillion yen stimulus package
Kyodo reports
One of the unsung reasons behind the USD/JPY rally today was a report, citing sources, that the Japanese government is considering a supplementary budget.
"The government initially envisaged compiling a stimulus package of somewhat more than 10 trillion yen . But the size is likely to double as the package will now include projects for fiscal 2017 and beyond and increase "zaito" low-interest government loans by 6 trillion yen," Kyodo reports.
The stimulus could be even larger, they report. And able will look for the rubber stamp from the Cabinet in early August. About half will be earmarked for infrastructure.USD/JPY Technical Analysis: Momentum Builds on the Upside, Buy on Dips
The USD/JPY currency pair broke above the 50-day moving average of ¥106.12 and then major channel top resistance at ¥106.30, hitting a fresh high of ¥107.49 overnight.
Technical indicators support further upside with a sustainable break below ¥106.20 signaling the end of the bullish trend. A bBreak below the 5-day moving average of ¥106.20 is likely to see the USD/JPY test the next support at the 10-day moving average of ¥104.90.
Recent strong US data has resulted in the rise in Fed rate hike expectations in 2016, supporting upside in the pair.
Trade idea: Buy on dips at ¥107.00 with a stop loss at ¥106.40, targeting ¥107.50-¥108.00-¥108.50.
source
Japan manufacturing PMI (preliminary): 49.0 in July (prior 48.1)
The Nikkei Japan Manufacturing PMI for July
USD/JPY Weekly Outlook: Central Bank Combo to Drive Dollar-Yen
The Japanese marco calendar starts on Monday when the merchandise trade balance for June will be released and should return to positive territory. Moreover, the index of business conditions for May will be published, with no estimate available, but the April number was at 100.
The most important day for traders will be on Friday. The day starts with June's unemployment rate report and it should stay at 3.2%. The number will be followed by CPI indices for June and inflation is expected to stay negative year-on-year.
More data will follow, including industrial production for June and retail sales, also for June.
Later, the Bank of Japan (BoJ) will announce its monetary policy decision. The official market consensus expects no changes, with the annual rise in the monetary base most likely staying at ¥80 trillion, whilst the interest rate is expected to remain at -0.1%.
The yen has depreciated sharply in the last two weeks and lost around 6 big figures mainly due to speculation that the BoJ will deliver further monetary stimulus, but these rumors were negated on Thursday by BoJ Governor Haruhiko Kuroda, but still, the Bank might surprise at its Thursday meeting.
From the US dollar perspective, services PMI for July are due on Tuesday, along with consumer confidence for the seventh month of the year. Moreover, new home sales for June are predicted to post 1.5% month-on-month growth.
On Wednesday, durable goods for June will be published and a slight improvement is predicted.
More importantly, the Federal Open Market Committee meeting will conclude and the Federal Reserve (Fed) will most likely leave the fed funds rate unchanged at 0.25 - 0.50%. However, the following statement will be important as US data have been positive in the previous weeks and therefore a slightly upbeat or hawkish statement is expected from the Fed.
On Friday, the first estimate of the US GDP for the second quarter is due and should improve notably to 2.6% from 1.1% in the previous quarter. Moreover, the PCE annualized index, along the GDP price index will be published.
Furthermore, the employment cost index is due, followed by the Chicago PMI and the University of Michigan consumer confidence gauge.
source
USD/JPY forecast for the week of July 25, 2016
The USD/JPY pair initially tried to rally during the course of the week, but turned back around to form a shooting star. The 105 level below is supportive, so if we can break down below there I feel that we will more than likely drop down to the 103 level. On the other hand, if we can break above the top of the shooting star, I believe that the market could reach towards the 108 with this, and then eventually the 110 level. Ultimately, I believe that the long-term downtrend continues, and as a result the sellers could very well jump back in.
Economic data due from Japan today - June trade balance
What would it take to get USD/JPY moving to the upside again?
The market is skeptical of BOJ and government actions
The market is still feeling burned from the whipsaw in USD/JPY after the surprise BOJ action in January. Every note I read is 'skeptical' the BOJ and/or the government can do enough to get USD/JPY going higher again.
The latest headlines showed the Japanese government tossing another $2.5B onto the stimulus bon fire and it was good for about 30 pips in USD/JPY.
The BOJ has effectively monetized a large portion of Japanese government debt and will re-load the bazooka with something else this week and the market is prepared to shrug it off.
It's as if this market has seen so many central bank nuclear bombs that it's no longer impressed by the mushroom cloud.
USD/JPY: Pair Bleeds, Drops Below ¥105
The USD/JPY pair plunged on Tuesday and was seen hovering around ¥104.30, 1.42% lower on the day, with volatility extreme during the Asian session.
The yen reversed losses on Monday and has been rising ever since, with the pair now around 250 pips lower that Monday's highs. The official Bloomberg consensus does not expect any changes to monetary policy at the Bank of Japan (BoJ) this Friday and traders are possibly starting to price this in.
"The big risk here is that markets are over estimating the ability of the Japanese central bank to deliver anything of note, given recent comments from central bankers about their growing unease about lower rates and their effectiveness, amidst rising concerns about the damage being inflicted on bank balance sheets," Michael Hewson, chief market analyst at CMC Markets UK, said on Tuesday.
However, despite such a big decline in the USD/JPY pair, sentiment was positive as stocks were seen ticking higher in the early dealing and higher-yielding currencies were all on the rise.
From the perspective of the US dollar, investors are anticipating today's services PMI and consumer confidence, both for July. New home sales for June are predicted to post 1.5% month-on-month growth.
Moreover, the Federal Open Market Committee meeting starts today and concludes on Wednesday. The Federal Reserve (Fed) will most likely leave the fed funds rate unchanged at 0.25 - 0.50%.
The following statement will be important as US data have been positive in the previous weeks and therefore a slightly upbeat or hawkish statement is expected from the Fed.
source
Preview: BoJ Prepares to Act as Storm Clouds Brew Over Japanese Economy
The Bank of Japan (BoJ) has had a tough time trying to boost the price level to 2%, with the sharp appreciation of the yen over the last six months doing little to help improve the outlook for inflation, adding to expectations that the bank will announce greater easing measures this week.
Most economists are anticipating either a cut to interest rates - which are already negative - or a change in the size or quality of assets purchased under the bank's Qualitative and Quantitative Easing (QQE) program.
There have also been plenty of rumors the BoJ is preparing to unleash somewhat more unconventional easing measures - helicopter money being the most prevalent - although BoJ Governor Haruhiko Kuroda ruled this out last month, according to a BBC report last week.
Capital Economics economist Marcel Thieliant thinks there is little appetite for such measures, but does believe that with underlying inflation weakening, there will be an announcement of greater easing on Friday.
"We forecast an increase in the annual pace of expansion of the monetary base from the current ¥80 trillion to ¥90 trillion, with the increase split equally between additional purchases of equity-linked exchange traded funds and Japanese Government Bonds," according to Thieliant.
"We also expect a cut in the policy rate from -0.1% to -0.3%, and we wouldn’t exclude the possibility that the bank starts to apply a negative rate to loans it provides to commercial banks."