JPY news - page 13
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Yen jumps as BOJ pauses their ETF buying spree
Bloomberg reporting that the BOJ didn't buy any regular ETFs today
USDJPY down through 101.00 and tripping some stops to 100.87, and the yen crosses are following suit.
After the BOJ started buying double the amount they usually were, a lot of market commentators assumed that they would be buying more regularly and higher amounts. The news today seems to suggest otherwise and that's popped a few expectation balloons.
USD/JPY forecast for the week of August 8, 2016
The USD/JPY pair initially fell during the course of the week, but bounced enough to form a nice-looking hammer. This of course makes quite a bit of sense as the US jobs report was much stronger than anticipated. In fact, right above the top of the hammer should send this market looking for the 105 handle. Given enough time, it’s very likely that the market will eventually continue to go higher as the 100 level below will attract the Bank of Japan, and possible intervention in this market or at least further quantitative easing.
BOJ opinion summary from July meeting out now
From the Bank of Japan 'Summary of Opinions' for the July 28/29 meeting
via Reuters
USD/JPY: Dollar Advances, Supported by Friday's Payrolls
The USD/JPY pair drifted higher during the London session on Monday and was trading 0.3% stronger around ¥102.30.
In addition, average hourly earnings improved slightly to 0.3% month-on-month in July, with the yearly print staying at 2.6%.
The US dollar instantly popped higher after the report and surged globally against all its major peers.
According to the CME FedWatch Tool, the odds for a December rate hike rose 9% after Friday's payrolls and are now at 38.4%. This shift, although only marginal, might support the US dollar against the yen, especially as all the bullish news for the yen appears to be priced in.
USD/JPY: Dollar Suffers Again, Drops Toward ¥101
The greenback suffered losses on Wednesday and the USD/JPY pair was trading around ¥101.50, down 0.40% on the day, although it was slightly higher from daily lows at ¥101.20.
Later in the day, US JOLTS job openings for June are due and should stay at 5,500K. Apart from that, there are no macro updates on the agenda.
In the previous session, US unit labor costs for the second quarter was released and rose from a downwardly revised -0.2% to 2.0%. Moreover, non-farm productivity marginally improved to -0.5% from -0.6% previously.
"Traditionally, non-farm productivity is a little watch indicator but the degree of the disappointment has hit markets. This is another data point that adds to the mixed recent releases that would suggest the Fed seems destined to hold off from its next rate hike at least until December," analysts at Hantec Markets said on Wednesday.
source
USD/JPY forecast for the week of August 15, 2016
The USD/JPY pair initially tried to rally during the course of the week, but turned back around to fall again. However, I think that the 100 level below is psychologically significant, and that the Bank of Japan very well could get involved. With this being the case, I stand on the sidelines as far as long-term trade are concerned. I would need to see some type of massive support candle in order to take a bit of a flyer when it comes to a longer-term move to the upside.
USD/JPY: Key Support Remains in Play
USD/JPY had a relatively quiet trading week, with a minor rebound on Monday failing to carry through, indicating a lack of buying interest remains evident in the pair. The week ended with USD/JPY flirting with 101, the level which has provided a floor for the currency since the beginning of the month.
Although trading was rather uneventful, one interesting technical development took place, the breakdown from a bearish flag formation on the daily chart. This took place as a result of Wednesday’s pullback and the breakdown remained valid through the end of the week. This development calls for another leg lower in USD/JPY’s long term downtrend, with a target for the next decline at approximately the 96.00 level.
Prior to achieving this target though, USD/JPY will have to breakdown below support near the century mark, the level, which initially came into play on the June 24th spike to the downside in the wake of the Brexit vote. A breakdown below 100, a key psychological level, would represent an important development that could get selling underway in earnest in the currency pair.
Downside follow through to start off the week would be a negative development, given the oversold condition currently a factor. The fact the pair has only managed a modest bounce from current levels despite being fully oversold on a daily basis is a sign of internal weakness.
At present, the probabilities of an attempt at a meaningful recovery rally over the near term appear rather low However, should a rebound take place, resistance is not far above current levels, at the 102.50-102.65 zone. Failing to move above this zone would be considered another sign of weakness and keep the intermediate term bias in the currency pair firmly to the downside.
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Japan’s Economic Expansion Grinds to a Halt in Second Quarter
he Japanese economy slowed to a crawl in the second quarter, bringing the threat of recession back to the forefront.
Gross domestic product (GDP) was unchanged in the second quarter after rising at a much faster than expected 0.5% pace in the first three months of the year, the Cabinet Office said in a preliminary report on Monday. A median estimate of economists called for growth of 0.2%.
In year-over-year terms, Japan’s GDP expanded just 0.2% after an upwardly revised gain of 2% in the first quarter. A median estimate called for a year-over-year expansion of 0.7%.
The Japanese government will release its final estimate of second quarter GDP on September 6.
The world’s third largest economy has been stuck in low-growth for the better part of two years, as weak domestic and international demand have undermined the government’s ambitious efforts to boost growth and re-inflate the economy.
Deflation intensified in June, with headline CPI falling for a fourth consecutive month. In response, the Bank of Japan doubled the size of its ETF purchase program last month, but stopped short of lowering interest rates or announcing additional easing measures. However, the BOJ’s Summary of Options report indicated that the government will unleash a new stimulus package that will be “extremely large in scale.”
Investors are eagerly awaiting the announcement of new stimulus measures following Prime Minister Shinzo Abe’s convincing upper house election victory last month. There still is no word as to when Kuroda will announce his new program.
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USD/JPY: Dollar Slips Toward ¥101
The USD/JPY pair slid on Monday as the greenback came under broad selling pressure, with the dollar trading around ¥101.10 during the London session, 0.15% weaker.
Earlier in the day, Japanese GDP for the second quarter missed expectations and weakened notably to 0.2% year-on-year, down from 1.9% previously. The quarterly change slowed to 0.0% from 0.5% booked in the first quarter.
In addition, final data for industrial production showed a 2.3% rise month-on-month in June, up from -2.6% scored in May. Capacity utilization also picked up to 1.5% from -2.4% previously.
"Of greater concern was that business spending also slid 0.4% when it was expected to rise 0.2%, meaning that for all the additional measures announced by Prime Minister Abe as well as the Bank of Japan in the last quarter the economy continues to struggle. Following on from last week’s disappointing US and Chinese data and it would appear that the global economy slowed down quite markedly in the second quarter," Michael Hewson, chief market analyst at CMC Markets UK, said on Monday.Japan - Reuters Tankan Manufacturers index at +1 in August (+3 in July)
The Reuters Tankan is out each month (the BOJ Tankan is once a quarter)