FXStreet (Guatemala) – USD/JPY is popping up in the open of Asia with continued negative GDP from the Japanese economy leading to Yen weakness on the speculation that the BoJ will need to act sooner or later, despite better than expected readings.
USD/JPY has penetrated the 50-SMA on the hourly chart in an otherwise bearish trend while the Yen has been favoured amongst the global uncertainties in a risk-off environment.
However, there has been some talk of “stability is coming” from officials in China and there are a number of schemes under way to bring stability back in the equity markets and the Yuan, while G20 delegates all agreed that there cannot be a manipulation of currencies. A statement from, Zhou Xiaochuan, the BoJ governor statement read: “At present, the exchange rate of the RMB against the dollar tends to be stable, and most of the correction of the stock market has taken place, so the financial market is expected to be more stable.”
We will wait to see whether the Chinese market can follow suit of the European markets today, while yesterday’s performances saw the Shanghai Composite closing down 2.32% by end of trade and the MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1 percent.
USD/JPY levels
The key 120.80/00 level remains a force keeping pressures to the downside on a technical picture, and is a key resistance, aligning with the 200 DMA. On further supply and a low of the 119 handle, 118.33/25 and March lows guard the 116.15/115.85 2015 low and the recent low. MACD is turning positive also.
(Market News Provided by FXstreet)