Forex Today: Yen Strengthens in Tokyo Trading

The week begins with the Tokyo session seeing a continuation of the recent trend movement in favour of the Yen and against the US Dollar.

   

  1. Today’s Tokyo session saw the Japanese Yen, the Euro, and Gold reach new multi-month highs against the US Dollar, although the Dollar recouped some of its losses towards the end of the session.
  2. Reports in Japan suggest that the Bank of Japan will consider side effects of its monetary policy at its meeting later this Wednesday, giving more credence to the prospect of a tighter policy. The Japanese Yen has continued to rise on the reports, with the USD/JPY currency pair trading as low as ¥127.21.
  3. The long-term bullish trend in precious metals continues, with the price of spot Gold rising to an 8-month high above $1928. The price of spot Silver is also bullish, but less so. These assets are attractive to long-term trend traders in the long direction right now, as higher prices here are likely over the coming days.
  4. In the Forex market, we currently see more in-trend movement in the major currency pairs, especially in the EUR/USD currency pair which has made another new 7-month high above $1.0868. The strong long-term technical trend against the US Dollar remains, with Japanese Yen the strongest major currency so far today, while the US Dollar is the weakest.
  5. Tomorrow will see a release of Chinese GDP data, which is expected to show the negative impact of its recent but former zero covid policy which was quickly overwhelmed by a massive spread of new coronavirus cases. The latest quarterly data is expected to show a drop in annualized growth from 3.9% to 1.6%.
  6. It is a public holiday in the USA today (Martin Luther King day) so US markets will be closed. As it is also a Monday, low volatility in major markets will likely be seen.
  7. Daily confirmed new global coronavirus cases decreased last week for the fourth consecutive week, but there are serious doubts over the veracity of China’s official statistics, which almost certainly dramatically understate new coronavirus cases.
  8. Total confirmed new coronavirus cases worldwide stand at over 671.3 million with an average case fatality rate of 1.00%. 
  9. The rate of new coronavirus infections appears to now be significantly increasing only in Japan, China, and Taiwan.

 

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.

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