The reasons why USD/JPY will likely collapse to 140
Removed incorrect reason for usual USD/JPY demand in first paragraph
Sept 6 -The dollar usually rises against the yen in September, but does not seem to be the case this year for a number of reasons.
The expectations that the U.S. Federal Reserve and Bank of Japan policy rates will narrow to some extent throughout the remainder of 2024, according to the LSEG Interest Rate Probability App, is weighing on USD/JPY.
The medium-term USD/JPY chart is bearish, as spot is trading well below the 144.59 Fibo, a 50% retrace of the 127.22-161.96 (2023-2024) EBS rise. A weekly close below the 144.59 Fibo would likely lead to even bigger losses to probe the 140 psychological level.
Speculators went short USD/JPY in August for the first time since Q1, 2021, according to position data derived from net contracts of the International Monetary Market. For the week ending Aug. 27, the short had slightly risen to USD/JPY 2.2 billion and that speculative position has the room to grow further without raising fears of a short squeeze.
For more click on FXBUZ
Policy Rate Expectations Chart: https://tmsnrt.rs/4eadxP2
Weekly Chart: https://tmsnrt.rs/3MAqDcw
Speculative Positions Chart: https://tmsnrt.rs/3AQnx1v
(Martin Miller is a Reuters market analyst. The views expressed are his own)
</body></html>Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
