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Latest USD JPY Analysis and Forecast

US Dollar strength on higher relative yields; Yen weak in "risk on" mode

  • The US Dollar rebounded after immediate weakness after the 7th March Fed Meeting
  • This strength resumed through March, but has seen more of a consolidation theme from late March into April 
  • This US Dollar strength has been assisted by US Treasuries move to higher yields, alongside US yield spread widening versus many other government bonds
  • The Japanese Yen is also weak as a "safe haven" currency, as global equity markets retain a "risk on" theme

Dip, looking for another rebound

Day trade update and view

A small dip on Monday after Friday's firm bounce to prod just above 109.94 resistance to 109.96, trying to resume upside pressures from the late March surge above the cycle high at 109.36 and to push on up to 110.97, plus from the entire 2021 bull trend, keeping the bias higher for Tuesday.  

Day trade setup

  • We see an upside bias for 109.94/96; a break here maybe aims for 110.55 and 110.97.
  • But below 108.97 quickly aims for 108.30/29, which we would look to ty to hold. Below maybe opens risk down to 107.50.

Intermediate-term outlook

The early February push above key 105.68/76 resistances signalled an intermediate-term shift to a bull trend.

  • Upside risks: We see an intermediate-term bull trend to aim for 106.95/07.02 and 109.85/110.00.
  • What changes this? Below 104.89 shifts the intermediate-term bull trend straight to an intermediate-term bear trend.

USD JPY Calendar

13/04/21 Chinese trade data; UK GDP, Manufacturing & Industrial Production; German ZEW Survey; US CPI

14/04/21 RBNZ interest rate decision and statement

15/04/21 Australian Employment report; German CPI; US Retail Sales

16/04/21 Chinese GDP, Retail Sales & Industrial Production; EU CPI

View Full Calendar

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