Japanese Yen Technical Analysis:USD/JPY Ascendent, Needs A Pause

Japanese Yen Technical Analysis Talking Points:

  • USD/JPY remains focused on this year’s peaks
  • However, its rise has been rapid and a pause seems likely
  • EUR/JPY is more defensive and eyes key support

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The Japanese Yen is still foundering against the US Dollar but USD/JPY’s long bounce from its August lows has shown some signs of exhaustion this week.

The fundamental picture continues to strongly favor the US Dollar over the Japanese currency even if as seems to be the case both catch investor bids when trade war worries are to the fore. The Federal Reserve continues to raise interest rates even as the Bank of Japan leaves its own monetary taps wide open and still pledges to do so until consumer price inflation sustainably hits 2%. It was at just 1.3% in August, so there is still a very long way to go.

For now Japan’s short-term base rate remains at -0.1%, while the Federal Funds Target Rate band is 2-2.5% and rising.

Article source: https://www.dailyfx.com/forex/technical/home/analysis/usd-jpy/2018/10/03/Japanese-Yen-Technical-Analysis.html