USD/JPY Losses To Persist As U.S. Yields Remain Under Pressure


DailyFX Table

Ticker

Last

High

Low

Daily Change (pip)

Daily Range (pip)

USD/JPY

111.73

112.23

111.56

34

67

USD/JPY stands at risk for further losses as it extends the series of lower-highs carried over from the previous week, while U.S. Treasury yields remain under pressure and give back the rebound from June.

With Fed Fund Futures still highlighting a 50/50 chance for a December rate-hike, it seems as though the recent remarks from Fed Chair Janet Yellen have tamed market expectations as the central bank head argues the benchmark interest rate ‘would not have to rise all that much further to get to a neutral policy stance.’ In turn, USD/JPY may exhibit a more bearish behavior over the near-term as the Federal Open Market Committee (FOMC) is expected to retain the current policy at the next rate decision on July 26.

At the same time, the Bank of Japan (BoJ) meeting may do little to shift the near-term outlook for the dollar-yen exchange rate as Governor Haruhiko Kuroda and Co. continue to embark on the Quantitative/Qualitative Easing (QQE) Program with Yield-Curve Control.

USD/JPY Daily

USD/JPY Daily Chart

Chart – Created Using Trading View

  • The rebound from the June-low (108.80) may continue to unravel as the bearish trigger in the Relative Strength Index (RSI) continues to unfold, with USD/JPY clearing the monthly opening range.
  • Break/close below the near-term support zone around 111.10 (61.8% expansion) to 111.60 (38.2% retracement) opens up the next region of interest around 109.40 (50% retracement) to 109.90 (78.6% expansion) followed by the June-low (108.80), which sits just above the Fibonacci overlap coming in at 108.30 (61.8% retracement) to 108.40 (100% expansion).
  • Reviews

    • Total Score 0%
    User rating: 0.00% ( 0
    votes )



    Leave a Reply

    Your email address will not be published. Required fields are marked *