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1 Sep 2015
USD/JPY offers penetrate 121 handle; bears eye 200 DMA
FXStreet (Guatemala) - USD/JPY is under pressure in the Tokyo open with equities continuing to open negative, on a down day for Asia yesterday with Europe and the US following suit, the Nikkei opens low and S&P futures remain in the red.
The theme that is gripping the market is the forthcoming FOMC this month and subsequent rate decision on the 17th from the Fed. Data is very key leading up to this event and the market is starting to make their calls on what the outcome of the meeting will be, while Central Bankers at the Fed are seemingly staying the course against a backdrop of a robust US economy. Key data this week will be the Nonfarm Payrolls, tipped to be a good number between 220-235k after the positive GDP Q2 outcome.
Analysts at TD Securities explained, "We don't believe the Fed will overreact to short-term developments, with Dudley himself unsure whether the recent moves are a “temporary adjustment or something more persistent.” The Fed has long telegraphed its desire to raise rates this year, and unless the global macro backdrop deteriorates substantially, we expect the Fed will make good on that pledge."
USD/JPY is turning more neutral as it continues to consolidate the recent market turmoil and volatility in the Yen. The hourly chart represents a move bullish tone than longer dated sticks that are bearish-neutral the further you go out.
USD/JPY technically exposing the downside
USD/JPY is painting a negative outlook when trading below the 121 handle, en-route for the key 120.70 200 DMA. Daily MACD is highly negative and the price recently penetrated down through the weekly 50 SMA at 119.51, so is a level to watch on a break of the 200 DMA. Below there the key support level is 118.00/50.
Should the major manage to stablise here though, 125.84 is the upside target as June highs. First the bulls will need to clear 123.20/30 and this area could be a tough resistance - This is the May 25th highs on the commencing rally out of the 4.5 month sideways channel and also comes in the vicinity of the 50 DMA at 123.14 today.
The theme that is gripping the market is the forthcoming FOMC this month and subsequent rate decision on the 17th from the Fed. Data is very key leading up to this event and the market is starting to make their calls on what the outcome of the meeting will be, while Central Bankers at the Fed are seemingly staying the course against a backdrop of a robust US economy. Key data this week will be the Nonfarm Payrolls, tipped to be a good number between 220-235k after the positive GDP Q2 outcome.
Analysts at TD Securities explained, "We don't believe the Fed will overreact to short-term developments, with Dudley himself unsure whether the recent moves are a “temporary adjustment or something more persistent.” The Fed has long telegraphed its desire to raise rates this year, and unless the global macro backdrop deteriorates substantially, we expect the Fed will make good on that pledge."
USD/JPY is turning more neutral as it continues to consolidate the recent market turmoil and volatility in the Yen. The hourly chart represents a move bullish tone than longer dated sticks that are bearish-neutral the further you go out.
USD/JPY technically exposing the downside
USD/JPY is painting a negative outlook when trading below the 121 handle, en-route for the key 120.70 200 DMA. Daily MACD is highly negative and the price recently penetrated down through the weekly 50 SMA at 119.51, so is a level to watch on a break of the 200 DMA. Below there the key support level is 118.00/50.
Should the major manage to stablise here though, 125.84 is the upside target as June highs. First the bulls will need to clear 123.20/30 and this area could be a tough resistance - This is the May 25th highs on the commencing rally out of the 4.5 month sideways channel and also comes in the vicinity of the 50 DMA at 123.14 today.