Forex Today: USD/JPY Breaks Out to 5-Year High

Adam Lemon

Markets are dominated by a weak Japanese yen and a strong US dollar on rising short-term yields.

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The yen is a popular asset during turbulent times.
  • In the Forex market, we see a strong US dollar as short-term yields rise to reach long-term highs, and a pronounced weakness in the Japanese yen. This puts a bullish USD/JPY at the center of today’s Forex market after it broke well beyond its 5-year high price on above-average volatility during the Asian session. If the price closes bullishly today, a further rise over the coming days in USD/JPY is likely.
  • Stock markets are mixed globally, but US and European market indices are bullish. The S&P 500 Index yesterday made its highest ever close and is currently trading near its record high, so it looks likely to rise higher over the coming days.
  • Markets are likely to be more active today as every G20 country’s winter public holiday season has ended.
  • Today will see OPEC meetings which may affect the price of crude oil, and US ISM Manufacturing PMI data which may affect the US dollar.
  • Data suggest that the omicron coronavirus variant, while considerably more infectious, has notably milder effects than previous coronavirus strains, with an estimated 70% reduction in the probability of hospitalization. This is potentially very good news for both health and economy, and this is helping to drive recent bullishness in stock markets.
  • It is estimated that 58.3% of the world’s population has received at least one dose of a coronavirus vaccination.
  • Total confirmed new coronavirus cases worldwide stand at over 293 million with an average case fatality rate of 1.87%.
  • The rate of new coronavirus infections appears to now be increasing most quickly in Albania, Algeria, Argentina, Australia, Bahamas, Barbados, Belize, Bolivia, Canada, Colombia, Croatia, Cyprus, Denmark, Dominican Republic, Ecuador, Estonia, Ethiopia, Finland, France, Greece, Iceland, Israel, Italy, Jamaica, Kuwait, Lebanon, Luxembourg, Mali, Malta, Montenegro, Portugal, Qatar, Spain, Sweden, Switzerland, the UAE, the UK, Uruguay, and the USA.
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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