4 Aug 2015
USD/JPY: bulls compromised on commodity weakness
FXStreet (Guatemala) - USD/JPY is currently trading 123.99 with a high of 124.04 and a low of 123.91.
USD/JPY is steady around the 124 handle after a slightly bearish bias in overnight trade with the price drifting lower from 124.27 levels to 123.85 on the downside. We are quiet in trade so far in Asia ahead of the Australian key events that include trade balance, retails sales and the RBA. For Japan tomorrow we await the Markit Services PMI's ahead of the BoJ statement and Kuroda's speech. We heard from the governor over the weekend in a news paper that inflation will pick up quickly in the latter half of this fiscal year. Meanwhile, the key event for the week will be the Nonfarm payrolls for the US. Meanwhile, commodities weigh on the global outlook, supporting the Yen on uncertainty.
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Technically, in the 4 hours chart, Valeria Bednarik, chief analyst at FXStreet explained that the technical indicators are also below their mid-lines, but heading nowhere, whilst the 100 SMA stands a few pips below the current level. There are little chances of seeing the pair gaining momentum either side of the board during the upcoming hours, and the more likely scenario is an extension of the 123.30/124.45 range until the release of the US Nonfarm Payroll report next Friday.
"However, we see little upside on a sustained basis for USD/JPY at this stage with falling commodity prices, China uncertainties and general EM FX weakness likely acting to help support the yen." - Derek Halpenny, analyst at The Bank of Tokyo Mitsubishi UFJ explained, "The large current account surplus in Japan is also a reminder of potential repatriation flows that will increasingly emerge at higher USD/JPY levels."
USD/JPY is steady around the 124 handle after a slightly bearish bias in overnight trade with the price drifting lower from 124.27 levels to 123.85 on the downside. We are quiet in trade so far in Asia ahead of the Australian key events that include trade balance, retails sales and the RBA. For Japan tomorrow we await the Markit Services PMI's ahead of the BoJ statement and Kuroda's speech. We heard from the governor over the weekend in a news paper that inflation will pick up quickly in the latter half of this fiscal year. Meanwhile, the key event for the week will be the Nonfarm payrolls for the US. Meanwhile, commodities weigh on the global outlook, supporting the Yen on uncertainty.
Register to the live coverage and trade the NonFarm Payrolls with Bednarik, Pinkert and Elam. We are Forex!
Technically, in the 4 hours chart, Valeria Bednarik, chief analyst at FXStreet explained that the technical indicators are also below their mid-lines, but heading nowhere, whilst the 100 SMA stands a few pips below the current level. There are little chances of seeing the pair gaining momentum either side of the board during the upcoming hours, and the more likely scenario is an extension of the 123.30/124.45 range until the release of the US Nonfarm Payroll report next Friday.
"However, we see little upside on a sustained basis for USD/JPY at this stage with falling commodity prices, China uncertainties and general EM FX weakness likely acting to help support the yen." - Derek Halpenny, analyst at The Bank of Tokyo Mitsubishi UFJ explained, "The large current account surplus in Japan is also a reminder of potential repatriation flows that will increasingly emerge at higher USD/JPY levels."