Yen. Image Source: PixabayThe Japanese Yen (JPY) adds to Friday’s strong gains against the US Dollar (USD) and kicks off the new week on a positive note, dragging the USD/JPY pair to a near three-week low, around the 146.25-146.20 region during the Asian session. Escalating conflict in the Middle East, along with fears of another COVID-19-like respiratory illness outbreak in China, tempers investors’ appetite for riskier assets. This comes on the back of speculations about a major shift in the Bank of Japan’s (BoJ) policy stance early next year and turns out to be a key factor that is seen boosting the JPY’s relative safe-haven status.The JPY bulls, meanwhile, seem rather unaffected by the recent less-hawkish comments by BoJ policymakers, saying that it was premature to debate an exit from negative interest rates. The USD, on the other hand, continues to be undermined by rising bets that the Federal Reserve (Fed) will maintain the status quo at the December policy meeting and start cutting interest rates by the first half of 2024. Even Fed Chair Jerome Powell’s attempts on last Friday to moderate rate-cut expectations did little to provide any respite to the buck or ease the bearish pressure surrounding the USD/JPY pair.Market participants now look to important US macro data scheduled at the beginning of a new month, including the closely-watched US monthly jobs report, or the Nonfarm Payrolls data, due on Friday for some meaningful impetus. Nevertheless, the aforementioned fundamental backdrop suggests that the path of least resistance for the USD/JPY pair is to the downside. This, in turn, supports prospects for an extension of the recent sharp pullback from the 152.00 neighbourhood, or the YTD peak touched in November amid Monday’s thin US economic docket, featuring the only release of Factory Orders data.Daily Digest Market Movers: Japanese Yen attracts haven flows amid geopolitical tensions and respiratory illness outbreak in China
Technical Analysis: USD/JPY seems vulnerable near multi-month low, 100-day SMA pivotal support breakdown in playFrom a technical perspective, the recent failure ahead of the 152.00 mark constituted the formation of a bearish double-top pattern on the daily chart. A subsequent break and close below the 100-day Simple Moving Average (SMA) on Friday further validates the near-term negative outlook for the USD/JPY pair. Spot prices, however, find some support near the 146.20 area, which represents the 38.2% Fibonacci retracement level of the July-October rally and should act as a key pivotal point. Given that oscillators on the daily chart are holding deep in the negative territory, some follow-through selling should drag the pair further towards the 145.45-145.40 intermediate support en route to the 145.00 psychological mark and the 50% Fibo. level, around mid-144.00s.On the flip side, any attempted recovery might now confront stiff resistance and meet with a fresh supply near the 147.00 mark. This, in turn, should cap the USD/JPY pair near the 100-day SMA support breakpoint, currently pegged near the 147.30-147.35 region. A sustained strength beyond, however, could trigger a short-covering rally and allow spot prices to reclaim the 148.00 round figure. The momentum could get extended further towards the 148.25-148.30 region.Japanese Yen price todayThe table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the weakest against the US Dollar.
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).More By This Author:GBP/JPY Price Analysis: Retreated Below 187.00 As Bears Hung On To Weekly GainsGold Price Forecast: XAU/USD Surged To A Seven-Month High Amid Powell’s RemarksEUR/USD Clears Daily Losses And Defends The 20-Day SMA, Closes A Losing Week