Friday, September 27, 2019

USD/JPY

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Fundamental Highlights

The Risk-on market sentiment led traders to drop the anti-risk Yen for the second consecutive day after China’s top diplomat said Beijing is willing to buy more US products ahead of the October 10 meeting. However, US Equities and Treasury yields are lagging for now, if they pick up some steam in today’s session, it would confirm another leg to the upside for the Dollar against the Yen. Furthermore, multiple Fed speakers gave out their take on the next rate decision as President Kashkari argued for steeper rate cuts, while Vice Chair Clarida thought inflation was close to target and Dallas’ Kaplan said trade uncertainty was affecting business investment. While most of them are turning dovish once again, the market is expecting further easing at the 31 October meeting. Today, Core Durable Goods Orders and Michigan Consumer Sentiment could be the key data to watch. A better-than-expected numbers will likely push the Dollar higher towards 108.

Technical Analysis

The Dollar-Yen retested the 50-day moving average for the second straight day, as the bulls looks like are gathering momentum for another leg higher. If 107.80 is broken, then 108.10 will be the next target for the bulls and possibly even higher. The bears on the other hand, need to break back below the latest higher low, 107.45, to regain possession.

Support: 107.45 / 107
Resistance: 107.80 / 108.10

Chart (H4)
USDJPY