USD/JPY fell toward the 156.000 area on 6 May after a sharp strengthening of the yen and broad US dollar weakness. The market is reacting to reports of progress in US-Iran negotiations, which reduced demand for the dollar and pushed oil prices lower. This is important for Japan, as expensive energy worsens the country’s trade balance and weighs on the yen; a lower oil premium partly removes this negative factor.
Another factor supporting the yen is expectations of action by Japanese authorities. Japan’s finance minister again warned of readiness to take decisive measures against excessive speculative moves, while recent sharp fluctuations have intensified discussion of possible intervention. Even without official confirmation, this risk is making market participants more cautious about holding long dollar positions against the yen near elevated levels.
The dollar may receive support if upcoming US employment data confirm the resilience of the economy and keep the Federal Reserve on pause for longer. However, as of the current date, the combination of a weaker dollar, lower oil prices and the risk of Japanese intervention creates an advantage for further USD/JPY decline. Therefore, preference is given to selling from current levels.
Trading recommendation: SELL 156.150, SL 157.050, TP 153.450
Another factor supporting the yen is expectations of action by Japanese authorities. Japan’s finance minister again warned of readiness to take decisive measures against excessive speculative moves, while recent sharp fluctuations have intensified discussion of possible intervention. Even without official confirmation, this risk is making market participants more cautious about holding long dollar positions against the yen near elevated levels.
The dollar may receive support if upcoming US employment data confirm the resilience of the economy and keep the Federal Reserve on pause for longer. However, as of the current date, the combination of a weaker dollar, lower oil prices and the risk of Japanese intervention creates an advantage for further USD/JPY decline. Therefore, preference is given to selling from current levels.
Trading recommendation: SELL 156.150, SL 157.050, TP 153.450
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More analytical information and promotions on FreshForex website cutt.ly/LrP6j9qD
면책사항
해당 정보와 게시물은 금융, 투자, 트레이딩 또는 기타 유형의 조언이나 권장 사항으로 간주되지 않으며, 트레이딩뷰에서 제공하거나 보증하는 것이 아닙니다. 자세한 내용은 이용 약관을 참조하세요.