Partner Center Find a Broker

After a choppy week, can yen crosses see one-directional price movements this week? Check out the market themes yen bulls and bears are likely watching.

BOJ’s policy announcement (Mar 16, Asian session)

  • Bank of Japan (BOJ) have been signaling readiness to ease policies since last week
  • Recall that the Fed has just cut its rates to 0.0% and RBNZ has reduced its rates by 75 basis points earlier today
  • How markets react depends on the variety and scale of BOJ’s policy changes

Lower-tier domestic data releases

  • Industrial production (Mar 17, 4:30 am GMT) is expected to maintain its initial reading of +0.8% in January
  • Trade balance (Mar 17, 11:50 pm GMT) is expected to show a surplus of 970B JPY after a 1,313B JPY deficit in January
  • Japan’s core CPI (Mat 18, 11:30 pm GMT) could slow down from 0.7% to 0.5% in February

Market risk appetite

  • COVID-19 updates, government responses, and their related economic impact will continue to drive JPY’s price action for most of the week
  • Top-tier economic events such as U.S. retail sales, Canada’s CPI and retail sales, and China’s data dump could provide intraday retracements and volatility spikes
  • Scheduled and unscheduled monetary policy changes from major central banks could also influence the safe haven yen’s price action

Technical snapshot

  • RSI considers JPY as “overbought” against AUD and GBP on the daily time frame

  • AUD/JPY, GBP/JPY, and NZD/JPY are all trading below their short AND long-term EMAs on the daily
  • CHF/JPY is trading above its short and long-term EMAs
  • EUR/JPY and USD/JPY are trading below their long-term EMAs but above their shorter-term EMAs. Watch out for potential retracements or reversals in the next few days

Missed last week’s price action? Read JPY’s price recap for March 9 – 13!