USD/JPY – Yen Steady After BOJ Remarks

The Japanese yen is steady on Monday, as USD/JPY trades just below the 107 line. It’s a quiet start to the week, with no US or Japanese releases on Monday. In Japan, BoJ Governor Haruhiko Kuroda reiterated the central bank’s policy stance.

On Monday, BoJ Governor Haruhiko Kuroda stated that Japan’s economy continues to improve modestly, although consumer demand has lessened since the consumption tax hike in April. The BoJ would prefer to stay on the sidelines, but there has been talk that the central bank could step in with additional stimulus if the economy takes a turn for the worse. Such a move would weigh on the already weak Japanese yen.

US releases wrapped up the week on a high note, as UoM Consumer Sentiment climbed to 86.4 points, its highest reading since July 2007. The markets had expected a reading of 84.3 points. This indicates that the US consumer remains optimistic about the economy and is not overly concerned about warnings of a global slowdown. On the housing front, Building Permits and Housing Starts met expectations. Strong US employment numbers continue to drive the US recovery, as US job claims dropped to 264 thousand, marking a 14-year low. The estimate stood at 286 thousand.

USD/JPY for Monday, October 20, 2014

USD/JPY October 20 at 8:55 GMT

USD/JPY 106.86 H: 107.39 L: 106.83

USD/JPY Technical

• USD/JPY moved higher in the Asian session but has retracted in European trade.
• On the downside, 106.85 is fluid and could break during the day. 105.44 is stronger.
• 107.68 is a strong resistance line.
• Current range: 106.85 to 107.68

Further levels in both directions:

• Below: 106.85, 105.44, 104.68 and 103.19
• Above: 107.68, 108.58, 109.82, 110.68 and 112.48

OANDA’s Open Positions Ratio

USD/JPY ratio is showing little movement on Monday. This is not consistent with the pair’s movement, as the yen has posted gains against the dollar. The ratio has a majority of long positions, indicative of trader bias towards the dollar reversing direction and moving higher.

USD/JPY Fundamentals

• 14:00 US FOMC Member Jerome Powell Speaks.

*Key releases are highlighted in bold

*All release times are GMT

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