USD/JPY has moved higher in the Monday session, as the pair trades at the 105 line. In economic news, the BoJ held interest rates in negative territory. In the US, today’s key event is ISM Manufacturing PMI.
As expected. the BoJ stayed on the sidelines and made no changes to its monetary policy. The bank maintained interest rates at -0.10% and also lowered its inflation forecast for 2017, from 1.7 percent to 1.5 percent. In its policy statement, the bank said that with regard to risk balance, risks to both economic activity and prices are skewed to the downside” and expects exports to remain “sluggish”.
The Japanese consumer remains in a surly mood, continuing to hold her purse strings tight in uncertain economic times. Retail Sales continue to contract, as the September reading of -1.9% was only slightly better than the August report of -2.1%. The indicator has managed only one gain in 2016. The Bank of Japan is in the spotlight, as the central bank holds a policy meeting on Monday and Tuesday. The bank will release a rate statement and set interest rates during the Asian session on Tuesday. Analysts expect the BoJ to maintain interest rates at -0.10%. As well, the bank’s asset-purchase program is expected to remain at JPY 80 billion/mth. The markets will be monitoring the rate statement and follow-up press conference. If the BoJ does make any changes to monetary policy or hints at future moves, we could see some volatility from USD/JPY.
USD/JPY Fundamentals
Monday (October 31)
- 22:55 BoJ Outlook Report
- Tentative – BoJ Policy Rate. Estimate -0.10%. Actual -0.10%
- Tentative – BoJ Monetary Policy Statement
- 2:30 BoJ Press Conference
Tuesday (November 1)
- 9:45 US Final Manufacturing PMI. Estimate 53.3
- 10:00 US ISM Manufacturing PMI. Estimate 51.8
- 10:00 US Construction Spending. Estimate 0.5%
- 10:00 US IBD/TIPP Economic Optimism. Estimate 48.7
- 10:00 US ISM Manufacturing Prices. Estimate 54.0
- All Day – US Total Vehicle Sales
*All release times are EDT
*Key events are in bold
USD/JPY for Tuesday, November 1, 2016
USD/JPY October 31 at 9:05 EDT
Open: 104.82 High: 105.12 Low: 104.61 Close: 104.86
USD/JPY Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 102.36 | 103.02 | 104.32 | 105.44 | 106.72 | 107.49 |
- USD/JPY was flat in the Asian session. In European trade, the pair posted slight gains but has retracted
- 104.32 is providing support
- There is resistance at 105.44
- Current range: 104.32 to 105.44
Further levels in both directions:
- Below: 104.32, 103.02, 102.36 and 101.20
- Above: 105.44, 106.72 and 107.49
OANDA’s Open Positions Ratio
USD/JPY ratio is unchanged in the Tuesday session. Currently, long positions have a majority (55%), indicative of slight trader bias towards USD/JPY breaking out and moving to higher levels.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
