And the bears just keep on coming! The yen was still unable to take a break on Friday, scoring losses against all of its major counterparts. USD/JPY hit a new 2-month high at 89.45 before finishing the day with a 101-pip gain. Meanwhile, EUR/JPY closed 210 pips higher at 118.97.
Disappointing data from Japan definitely didn’t help the yen. The country’s current account printed at -222.4 billion JPY for November which didn’t only fall short of the -17.1 billion JPY forecast, it also translated to the second largest trade deficit ever. Of course, the release of the negative report only put even more pressure for the BOJ to launch more stimulus measures to boost the economy.
Today our forex calendar is blank for reports from the Land of the Rising Sun. Perhaps the yen will be able to finish the bulls’ turf? Maybe. I would keep close tabs on market sentiment If I were you though. Remember that the yen usually does well when risk aversion is in play.
The yen plunged deeper in the world of hurt yesterday when it continued to drop against its major counterparts. USD/JPY jumped by another 14 pips while EUR/JPY gained another 40 pips. What the heck is driving the yen bears?!
As Forex Gump discussed last weekend, most of the yen’s weakness can be attributed to the high probability of the Japanese government introducing more stimulus to weaken the yen and boost the economy. The Land of the Rising Sun had a bank holiday yesterday, but Prime Minister Shinzo Abe’s remarks on the BOJ’s future involvement on employment was enough to spur on the yen bears.
Aside from the preliminary machine tools orders data at 7:00 am GMT, no other report is scheduled for release today. But instead of ignoring the yen pairs, make sure that you’re marked the possible inflection points that might influence a reversal or a retracement in the yen pairs. You could also watch out for any speeches from the Japanese government that could add to the yen’s weakness.
Is this merely a retracement or the start of a reversal? Either way, let’s give the Japanese yen a round of applause for finally being able to outpace its counterparts yesterday! USD/JPY closed 59 pips down from its 89.39 open price while EUR/JPY ended the day at 118.08. Will the yen be able to hold on to its gains?
After dumping the yen on the BOJ’s dovish monetary policy stance, traders now focused on the latest comments from Japanese Economy Minister Amari who thought that the yen was weakening too fast. He expressed concerns about a sudden correction due to profit-taking, which could have a negative impact on the Japanese economy in the short-term. At the end of the day though, overall yen weakness is welcomed in Japan as it could help ward off deflation and restore demand for Japanese exports.
As for economic data, only medium-tier reports were released from Japan lately and these didn’t seem to have a huge impact on the yen pairs’ price action. Keep your ears peeled for any other comments from Japanese officials today as these appear to have a larger effect on the yen’s movement!
It’s starting to look like what we’re seeing is a legit reversal on USD/JPY! For the second straight day, the pair slid off its opening price, and in the end, it finished 29 pips lower at 88.51. What gives?
Word on the street is that even Japanese officials didn’t expect to see the yen sell off the way it did the last few weeks, which could be the reason why the yen is chalking up gains at the moment. Remember, one of the main objectives of central banks is to achieve price stability. And while Japanese exporters may benefit from a weaker yen, rapid depreciation could seriously harm importers and cause foreign investors to lose interest in Japan.
In other news, the tertiary activity report just came out a few hours ago and it printed well in the red, revealing a 0.3% decline versus forecasts that called for a 0.1% uptick. Unfortunately, this is all we’re gonna get from Japan today, so remember to keep risk sentiment in check if you plan on trading the yen, homies!
Another day, another selloff! The Japanese yen lost ground to the U.S. dollar once more as USD/JPY edged up to test the 90.00 major psychological resistance. EUR/JPY also ended the day in the green as the pair closed at 120.54 while GBP/JPY had its share of gains as it closed 15 pips above 144.00.
Weaker than expected Japanese tertiary industry activity for the month of November weighed on the Japanese yen since the early Asian session as the actual figure posted a 0.3% decline. This was way off the estimate of a 0.1% uptick in services activity for the month.
Later on during the day, the yen underwent a stronger selloff as traders started pricing in their expectations for next week’s BOJ interest rate decision. Many are expecting the central bank to set a higher inflation target, which could mean looser monetary policy. I’ll keep you posted on what’s expected for their statement next week but let’s first take a look at what’s in store for today.
There are no major reports on Japan’s schedule this Friday but there are a couple of reports that could have a significant impact on risk sentiment. First of these is the Chinese GDP figure, which is expected to climb from 7.4% to 7.8%. Next up is the U.S. consumer sentiment figure, which is also expecting a slight improvement for the current month. Note that weaker than expected figures could spark risk aversion, which might be positive for the lower-yielding yen.
Surprisingly enough, we got a lot of action from the yen to end the week. It snatched 60 pips from the euro and 131 pips from the pound, but ended virtually unchanged against the dollar.
It seems the markets have been preparing for tomorrow’s BOJ monetary policy statement by dumping the yen.
Why in the heck would they do that? Well, some say that a shift to a 2% inflation target has already been fully priced in and that the central bank probably won’t lay down any fully detailed plans. If that’s the case, the BOJ might just lay the groundwork for future moves in today’s meeting, and that might not serve as a strong incentive for traders to load up on yen positions just yet.
Nevertheless, it’s hard to imagine the yen taking on big losses especially since the BOJ has already vowed to take a more aggressive stance towards monetary easing. Ultimately, this week might still end in favor of yen sellers, especially if the BOJ announces bold monetary easing measures.
In any case, y’all better stay on your toes because the BOJ meeting is right around the corner. Don’t blink, fellas! We could see another 100-pip move in tomorrow’s Tokyo session!
And the countdown begins! The yen pared back some of its losses against its counterparts yesterday as market players position themselves ahead of the big BOJ monetary policy announcement. GBP/JPY lost 73 pips yesterday while USD/JPY retreated from the major 90.00 handle.
The Land of the Rising Sun didn’t pop up any economic report yesterday, so traders had nothing to chew on but the upcoming BOJ monetary policy announcement scheduled today. Word on the hood is that the BOJ is set to double its inflation target to 2% and announce an unlimited QE program not unlike the Fed’s.
Will the BOJ meet the markets’ expectations? Yen pairs are likely to get a boost if the BOJ inks the unlimited QE program and new inflation targets, but you should also watch out for a potential buy-the-rumor-sell-the-news scenario. Not only that, but you also have to prepare your trading plan in case the BOJ disappoints and only announces a limited stimulus program.
In any case, don’t forget to read and prepare well and to stick to your trading plan!
What a letdown! The BOJ monetary policy statement turned out to be a big party pooper as it led to huge losses on yen pairs. USD/JPY fell 101 pips while EUR/JPY slipped 132 pips. Has the yen selloff finally come to an end?
Blame it all the the BOJ! The central bank disappointed the markets yesterday, even though it announced new measures to boost the economy. Its plans may seem bold at first, but look you’ll see that there isn’t much conviction behind them.
It raised its inflation target from 1% to 2% and announced open-ended asset purchases, but the details reveal a far less aggressive manner of execution. For starters, even with open-ended asset purchases, the BOJ only sees core CPI at 0.9% in 2014 (revised up by 0.1%). This tells us that realistically, the central bank doesn’t see itself reaching its inflation target until 2015 or 2016 at the soonest.
Furthermore, its open-ended asset purchases won’t take effect until 2014, which means it’ll have to find some other way to boost the economy until then. So far, the markets aren’t taking this news lightly and they’ve been taking their frustrations out on yen crosses. But keep in mind that when all is said and done, the BOJ is still maintaining a dovish stance, so losses for the yen might be limited in the medium-term.
Looks like we’re in for a major battle on the yen pairs! After two days of bloodbath, both EUR/JPY and USD/JPY have formed dojis on their daily charts, indicating that the bulls and bears are going at it. Who will emerge victorious and who will suffer a painful death?
With the BOJ deciding that it would start it’s open-ended asset purchase program a year from now, traders have been reluctant to sell the yen, with the reason being they just ain’t sure what the BOJ will do from now until then. This has allowed the yen to keep its gains from the last few days.
In other news, a report earlier today showed that Japan posted a trade deficit of 800 billion JPY last month, which was higher than the projected deficit of 710 billion JPY, but less than the 850 billion JPY the month before.
No more data lined up for today, but make sure you keep an eye on those yen pairs! Who knows what may tilt odds in favor of the bulls or bears today!
Yen bears, unite! After a few days of licking its wounds, the Japanese currency got heavily beaten again in yesterday’s trading as USD/JPY climbed to the 90.50 area. EUR/JPY also made a nice comeback as it managed to close 32 pips above the 120.00 handle.
Japan’s CPI figures for December posted another decline in price levels, marking the sixth consecutive monthly drop in inflation as Tokyo core CPI slipped by 0.5% while the national core CPI fell by 0.2%. This just goes to show that the BOJ’s goal of battling deflation and bringing annual inflation to 2% is not an easy feat at all. As a result, the Japanese yen resumed its selloff as traders anticipated further easing measures from the central bank down the line in order to achieve their inflation target.
There are no reports due from Japan today, which means that the yen’s price action could be driven by safe-haven flows. Unless we see a drastic change in risk sentiment today, the yen could keep getting dragged down by expectations of more asset purchases from the BOJ. Stay on your toes!
Wow, oh wow! The yen, just can’t catch a break! Thanks to more remarks from Japanese officials about the yen being too strong, USD/JPY rose past the 91.00 handle, before closing with a 103-pip loss for the yen. Meanwhile, EUR/JPY staged a 200-pip rally closing at 122.52.
Japanese officials talked about how they want USD/JPY to trade around 95.00-100.00. Of course, such remarks only encouraged more yen selling which was intensified by risk appetite.
Our forex calendar doesn’t have anything on tap for the yen today. However, keep an ear out for comments from BOJ officials. Who knows, they could talk about weakening the yen again and send it lower against its counterparts.
Aww, snap! The yen’s losing steak finally came to an end! USD/JPY tapped a two-and-a-half-year high at 91.26 before finishing the day 28 pips lower at 90.74.
The yen has been losing day after day to the dollar, but it looks like the yen bears have finally started to lose some fuel. But don’t get too excited buying the yen just yet. Remember that the BOJ said that they have no problem seeing USD/JPY trading around 100.00. Be sure to wait for confirmation before pulling the trigger on your yen trades, ayt? Keep in mind that the currency usually does well when risk aversion is in play.
Boooring! We didn’t get much action from the yen yesterday; USD/JPY just traded near its recent highs, finishing the day just 3 pips lower at 90.71. Let’s see if action will pick up today!
So far, things are already looking better. USD/JPY is up about 20 pips from its opening price and seems to be interested in testing in two-year highs.
The release of weak Japanese data might have had something to do with the yen weakness that we’re seeing. Just a few hours ago, Japan released retail sales numbers that revealed a mere 0.4% rise, which although met forecasts, isn’t an impressive follow-up to the previous month’s 1.2% surge.
At 11:15 pm GMT we have the manufacturing PMI coming out while preliminary industrial production data is due at 11:50 pm. However, these reports will likely take a backseat to the U.S.'s tier one reports, so be sure to check out my USD commentary if you plan on trading USD/JPY.
The yen got kicked to the curb in yesterday’s trading AGAIN! After a couple days of wins against the dollar, the currency once again gave up ground when USD/JPY closed 50 pips higher at 91.21. Meanwhile, against the euro, the yen suffered a whopping 138-pip loss.
Despite the negative GDP report from the U.S. and dovish FOMC, the yen failed to get a breather from the bears partly because Japanese stocks continued to rally.
But perhaps yen beats will finally let up on their advances should the remaining roster of U.S. data come in below expectations. Keep in mind that we still have the NFP report on tap on Friday which could be a big market-mover!
Earlier today, a handful of reports were released from Japan but they didn’t move the yen so much. The manufacturing PMI report for January came in higher at 47.7 than the 45.0 reading for December. However, the preliminary industrial production report for the same month only printed at 2.5% versus the 4.2% forecast and the average cash earnings report was only at -1.4% when it was expected to post a 1.1% uptick.
When will the bleeding stop?!? The yen was badly beaten again yesterday as it gave up ground against other major currencies. The yen lost 34 pips to the euro, 18 pips to the dollar, and 90 pips to the pound.
There have been a couple of economic reports that have been released since my last report.
Japan’s housing starts, for instance, was published. It showed that there was a 10% increase in the number of new residential buildings in construction, which was slightly lower than the 13.6% increase the market had initially predicted.
Earlier today, the consumer spending report and the unemployment rate figure were released. Consumer spending fell 0.7% while the unemployment rate climbed to 4.2% from 4.1%. Both proved to be negative for the yen as they were both weaker than expected.
No data on the data cupboard today but I think we’ll see a lot of action in the charts today. During the U.S. trading session, the non-farm payrolls will be released. It’s a major market-mover that will likely have a big effect on the yen’s price action.
Talk about having a bad week! Once again, the yen founds itself in the gutter, as traders continued to dump it in favor of higher yielding currencies. Both USD/JPY and EUR/JPY broke out to new highs, which only makes me wonder, how much longer can this selling continue?
We don’t really have any rim-rocking reports on tap from Japan this week, so we can expect sentiment to be the major driving force of yen pairs this week. Seeing as how the euro and dollar have been on a roll lately, it’ll be interesting to see if EUR/JPY and USD/JPY continue to surge higher. Be sure to hit up my EUR and USD commentaries to find out what could affect those currencies this week!
Nothing lasts forever, so make sure you know when to call it quits. After three straight days of gains, USD/JPY finally staged a correction and stayed below the 93.00 handle. The pair, which began the day at 92.67, found itself sitting at 92.39 by the end of the New York session.
The pair traded lower due to the weaker risk sentiment on concerns about the political situation in the euro zone. Apparently, there were allegations that Spanish Prime Minister Mariano Rajoy accepted illegal cash payments during his term.
No data on Japan’s economic cupboard today, so unless we see some major surprises, I suspect the yen will trade sideways today. Keep a close eye on those major support and resistance levels traders! They may serve as today’s inflection points!
ShirakaWHOA!!! Thanks to an announcement by the BOJ’s Shirakawa yesterday, the yen continued its slide against its counterparts. USD/JPY popped up by another 101 pips while EUR/JPY enjoyed a nice 205-pip rally.
BOJ’ Shirakawa’s speech was the only report scheduled in the Land of the Rising Sun yesterday, but it sure wasn’t a snoozer! In his speech, Shirakawa announced that he would be stepping down on March 19 this year, three weeks earlier than planned.
As expected, the yen plunged across the board at the announcement. You see, Shirakawa’s earlier resignation would place the new BOJ Governor, one that would most likely support the government’s easy monetary policy stance, a couple of weeks earlier.
Do you think that the rally still has legs though? Japan won’t be releasing any economic report today, so the yen traders will probably continue to move on Shirakawa’s announcement.
Doji alert! Finally, the yen was able to hustle some muscle in yesterday’s trading! After tapping the 94.00 handle, USD/JPY traded lower, finishing the day 2 pips below its opening price at 93.37. I know it’s just two pips, but a win is still a win, right?
No economic reports were released from either Japan or the U.S. which might have helped convince traders to take profits. After all, the yen has been making lows almost on a daily basis. Some market junkies might have decided to bank some of 'em pips in.
We still have nothing for the yen today. With that said, be sure that you keep tabs on market sentiment, ayt? Should risk aversion pick up, I wouldn’t be surprised to see the yen rally.
With the euro region hogging the currency spotlight yesterday, it’s no surprise that the yen is back to performing with mixed results against its counterparts. USD/JPY ended up only 16 pips higher than its open price while EUR/JPY slid by 92 pips. What gives?
Well, the yen’s price action might have more to do with news on its counterparts rather than the yen. It doesn’t mean that Japan’s reports didn’t have impact though. Core machinery orders from the Land of the Rising Sun showed a 2.8% growth for in December, which is way better than the 0.7% downtick that analysts were expecting. Even the leading indicators rose by 93.4% after clocking in at 92.1% last month.
Let’s see if we’ll see a clearer price action for the yen. Earlier today Japan’s current account balance came in at 0.10 trillion JPY, which disappointed expectations of a 0.18 trillion JPY reading. Bank lending had improved though, and showed a 1.3% uptick against last month’s 1.1% figure.
Only the economic watchers’ sentiment report at 6:00 am GMT is scheduled for release today, so the yen will most likely move on major news from the euro region and the U.S. Make sure you stick around to trade the potential market movers, aight?