The USD/JPY pair edged higher through the first half of the trading action on Tuesday and climbed to fresh daily tops, around the 109.30-35 region heading into the European session.
Following the previous day’s pullback of around 80 pips from three-week tops, the pair managed to regain positive traction and was supported by a goodish pickup in the US dollar demand. Speculations that positive US economic data may force the Fed to raise interest rates sooner rather than later and forced investors to lighten their bearish USD bets.
The momentum was further sponsored by an extended selloff in the Japanese yen amid worries that the recent surge in COVID-19 cases could hinder Japan’s fragile economic recovery. Apart from this, the BoJ’s forecast that inflation will not reach the 2% target through early 2023 further acted as a headwind for the safe-haven JPY and remained supportive.
That said, a combination of factors might hold bulls from placing aggressive bets. A generally softer tone around the US equity futures could extend some support to the safe-haven Japanese yen. This, along with the Fed’s stubbornly dovish outlook might further contribute towards keeping a lid on any runaway rally for the USD/JPY pair, at least for now.
Tuesday’s US economic docket features the second-tier releases of Trade Balance figures and Factory Orders data. Investors might also prefer to wait on the sidelines ahead of Friday’s release of the US monthly jobs report (NFP), making it prudent to wait for some follow-through buying before positioning for any further appreciating move.
All information on this website is of a general nature. The information is not adapted to conditions that are specific to your person or entity. The information provided can not be considered as personal, professional or legal advice or investment advice to the user.
Signal Factory is not represented as a registered investment consultant or brokerage dealer nor offers to buy or sell any of the financial instruments mentioned in the service offered.
While Signal Factory believes that the content provided is accurate, there are no explicit or implied warranties of accuracy. The information provided is believed to be reliable; Signal Factory does not guarantee the accuracy or completeness of the information provided. Third parties refer to Signal Factory to provide technology and information if a third party fails, and then there is a risk that the information may be delayed or not delivered at all.
All information and comments contained on this website, including but not limited to, opinions, analyzes, news, prices, research, and general, do not constitute investment advice or an invitation to buy or sell any type of instrument. Signal Factory assumes no responsibility for any loss or damage that may result, directly or indirectly, from the use or dependence on such information.
All information contained on this web site is a personal opinion or belief of the author. None of these data is a recommendation or financial advice in any sense, also within the meaning of any commercial act or law. Writers, publishers and affiliates of Signal Factory are not responsible for your trading in any way.
The information and opinions contained in the site are provided for information only and for educational reasons, should never be considered as direct or indirect advice to open a trading account and / or invest money in Forex trading with any Forex company . Signal Factory assumes no responsibility for any decisions taken by the user to create a merchant account with any of the brokers listed on this website. Anyone who decides to set up a merchant account or use the services, free of charge or paid, to any of the Forex companies mentioned on this website, bears full responsibility for their actions.
Any institution that offers a service and is listed on this website, including forex brokers, financial companies and other institutions, is present only for informational purposes. All ratings, ratings, banners, reviews, or other information found for any of the above-mentioned institutions are provided in a strictly objective manner and according to the best possible reflection of the materials on the official website of the company.
Forex trading is potentially high risk and may not be suitable for all investors. The high level of leverage can work both for and against merchants. Before each Forex investment, you should carefully consider your goals, past experience and risk level. The opinions and data contained on this site should not be considered as suggestions or advice for the sale or purchase of currency or other instruments. Past results do not show or guarantee future results.
Neither Signal Factory nor its affiliates ensure the accuracy of the content provided on this Site. You explicitly agree that viewing, visiting or using this website is at your own risk.