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24 Aug 2015
USD/JPY bears flexing muscles in early Asia
FXStreet (Guatemala) - USD/JPY is trading sub the 122 handle in a risk off tone to start the week.
USD/JPY has dumped through the 122.00 level on this opening early Asian trade. The bearish gap may well be targeted as we progress through the session with 121.80 the previous lows of 21st August coming in as key support, and any follow through there will indicate that the bears are committing to the downside at the start of the week.
The move is a further extension of the risk-off play and downside in the major where the 124 handle and bulls foothold since the first trading week of the month was penetrated as global markets become fearful of the implications that a struggling China will play, whose government and central bank are making efforts to spur growth while at the same time the hand of the US Federal Reserve is forced towards a change of monetary policy. However, at this point it is apparent that timings of a rate hike may not be appropriate.
Data for USD/JPY
The week ahead is a busy going to be a busy week for the US with Jackson Hole Symposium (27-29 Aug), although this year's Jackson Hole Symposium is unlikely to be a major market moving event in the noticeable absence of Fed Chair Yellen. We also have Durable Goods Orders (26 Aug) and US GDP (27 Aug) and such revisions to Q2 GDP should be positive and leave a favourable the handoff to Q3 GDP which should be supportive of the greenback.
USD/JPY hovering over key support
Technically, USD/JPY 122.80 should be a strong area of support as being the 38.2% retracement if the move up from July. However, the downside pressure and momentum is strong and opens up territory towards the 121.50 2015 uptrend. Near term rallies in a recovery may be limited to the recent resistance of 123.60/80 ahead 125.20 and the the June peak at 125.86 and the May 1997 high at 127.48.
USD/JPY has dumped through the 122.00 level on this opening early Asian trade. The bearish gap may well be targeted as we progress through the session with 121.80 the previous lows of 21st August coming in as key support, and any follow through there will indicate that the bears are committing to the downside at the start of the week.
The move is a further extension of the risk-off play and downside in the major where the 124 handle and bulls foothold since the first trading week of the month was penetrated as global markets become fearful of the implications that a struggling China will play, whose government and central bank are making efforts to spur growth while at the same time the hand of the US Federal Reserve is forced towards a change of monetary policy. However, at this point it is apparent that timings of a rate hike may not be appropriate.
Data for USD/JPY
The week ahead is a busy going to be a busy week for the US with Jackson Hole Symposium (27-29 Aug), although this year's Jackson Hole Symposium is unlikely to be a major market moving event in the noticeable absence of Fed Chair Yellen. We also have Durable Goods Orders (26 Aug) and US GDP (27 Aug) and such revisions to Q2 GDP should be positive and leave a favourable the handoff to Q3 GDP which should be supportive of the greenback.
USD/JPY hovering over key support
Technically, USD/JPY 122.80 should be a strong area of support as being the 38.2% retracement if the move up from July. However, the downside pressure and momentum is strong and opens up territory towards the 121.50 2015 uptrend. Near term rallies in a recovery may be limited to the recent resistance of 123.60/80 ahead 125.20 and the the June peak at 125.86 and the May 1997 high at 127.48.