Fundamental forecast for Japanese Yen: Bearish Janpanese Yen remains a strong sell versus the US Dollar. Strong jump in volume helps confirm USDJPY breakout The Japanese Yen broke convicingly lower versus the US Dollar as the USDJPY set its single-largest weekly advance on the year. It is believed the currency pair remains an attractive buy on the impressive break higher. What drove the yen and, more imprortantly, what may cause further volatility in the days and weeks ahead? Put simply: a divergence. On the one hand you have the Bank of Japan widely expected to ease monetary policy further through the end of the year. Across the Pacific Ocean, the US Federal Reserve is actually tightening monetary policy. The interest rate-sensitive USDJPY will likely track higher as the two central banks go in opposite directions. call for further tightening in monetary policy. Japancese central bank will boost quantitative easing purchases through upcoming meetings. A JPY bounce seems relatively unlikely. Its entirely possible and perhaps even likely that the Japanese Yen corrects higher (USDJPY lower) before its next major move.
Posted on: Fri, 12 Sep 2014 21:39:02 +0000
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