USD/JPY – Yen trading sideways, Japanese inflation report next

USD/JPY is showing little movement in the Thursday session. In North American trade, the pair is trading at 112.17, down 0.09% on the day. In economic news, U.S indicators looked sharp, as Philly Fed Manufacturing Index and unemployment claims both beat expectations. In Japan, Japanese National Core CPI is expected to tick up to 0.9%. As well, Flash Manufacturing PMI is forecast to improve to 53.1 points.

At the BoJ policy meeting this week, policymakers held its short-term interest rate target at -0.1 percent and a pledge to guide 10-year government bond yields around zero percent. The BoJ also maintained a pledge to keep interest rates extremely low for an extended period. The Bank sounded optimistic in its rate statement, noting that the economy was “expanding moderately”.

After a brief respite, the US-China trade spat ratcheted upwards this week. Following weeks of speculation, U.S President Trump announced 10% tariffs on some $200 billion worth of Chinese goods. Only this time, investors didn’t panic and the Japanese yen and other currencies have held their own against the greenback. Investors appeared to have been ready for a move by Trump, and may be sighing in relief that the tariff was set at 10% rather than at 25%. One senior economist summed up Trump’s most recent salvo as “bad but manageable”. However, if the Chinese do indeed retaliate and the U.S takes further measures, this would likely shake up the currency markets and boost the U.S dollar.

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USD/JPY Fundamentals

Thursday (September 20)

  • 8:30 US Philly Fed Manufacturing Index. Estimate 17.5. Actual 22.9
  • 8:30 US Unemployment Claims. Estimate 210K. Actual 201K
  • 10:00 US CB Leading Index. Estimate 0.5%
  • 10:00 US Existing Home Sales. Estimate 5.36M
  • 10:30 US Natural Gas Storage. Estimate 81B
  • 19:30 Japanese National Core CPI. Estimate 0.9%
  • 20:30 Japanese Flash Manufacturing PMI. Estimate 53.1

*All release times are DST

*Key events are in bold

USD/JPY for Thursday, September 20, 2018

USD/JPY September 20 at 10:30 DST

Open: 112.28 High: 112.34 Low: 112.05 Close: 112.17

 

USD/JPY Technical

S3 S2 S1 R1 R2 R3
109.21 110.21 111.22 112.30 113.75 114.73

USD/JPY ticked lower in the Asian session and showed little movement in the European session. The pair is steady in North American trade

  • 111.22 is providing support
  • 112.30 was tested earlier in resistance

Further levels in both directions:

  • Below: 111.22, 110.21, 109.21 and 108.28
  • Above: 112.30, 113.75 and 114.73
  • Current range: 111.22 to 112.30

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.