Japan

It’s a big week for the Japanese Yen. While the BoJ may not pose any moves to rates the quarterly outlook could keep the JPY on the move after the last release triggered a breakdown in USD/JPY.

USD/JPY tested a major level earlier this week but, so far, it’s held as support. EUR/JPY and GBP/JPY present compelling backdrops on each side of the Japanese Yen.

Yen weakness has continued to show, and USD/JPY has jumped up to a key Fibonacci level on the way to fresh three-week highs.

USD/JPY has just tested the 23.6% retracement of the long-term trend driven by the carry trade, but bears are again showing caution while at fresh lows.

USD/JPY traded below the 150.00 level for the first time in more than two months. If the trend continues there could be repercussions in several markets.

Japan's Q4 GDP is the latest to data to outperform estimates and, through the lens of CESI (Cit Economic Surprise Index), Japan's data is also outperforming its peers. While USD/JPY is considering a break of 151, I'm on guard for a false break before the real move to 150 materialises.

USD/JPY has shown a higher-low on the daily chart and at this point it seems to have evaded much of the tariff drama that’s engulfed other USD-pairs.

USD/JPY had a bullish response to the December FOMC rate decision and the pair is fast approaching a big spot of longer-term resistance at the 160.00 handle.

USD/JPY set a lower-high last week even as DXY spiked up to a fresh two-year-high. And there’s now a short-term descending triangle formation setting up in the pair.

The 150 level had held as resistance in USD/JPY until this week’s US open, at which point another DXY-fueled breakout appeared. The next major level up is the same that held multi-year highs in the pair in Q4 of each of the past two years.

It’s been a fast start to Q4 for the US Dollar. The turn in EUR/USD was a big driver yesterday and today, USD/JPY has taken over with buyers continuing a strong bounce from the Monday low.