04
Oct

USD/JPY remains flat above the 149.00 mark, 10-year JGB yields reaches 0.8% for the first time since 2013

  • USD/JPY consolidates its recent losses near 149.20 as investors fear the intervention.
  • The 10-year Japanese Government Bond (JGB) yield reached 0.8% for the first time since 2013.
  • US JOLTS Job Openings came in above expectations.
  • Traders will monitor US ADP Employment Change and ISM Services PMI due on Wednesday.

The USD/JPY pair remains flat at around 149.20 during the early European session on Wednesday. The pair holds above the 149.00 mark after retracing to a low of 147.33 late Tuesday amid the rumors of Japan’s FX intervention.

On Wednesday, the 10-year Japanese Government Bond (JGB) yield reached 0.8% for the first time since 2013. This put more pressure on the BoJ to its yield-curve cap and prepare for the end of its negative interest rate policy. Meanwhile, the US Treasury yield edges higher along with the rally of US Dollar (USD). The 10-year yield reached 4.865%, the highest since 2007.

Late Tuesday, USD/JPY dipped nearly 300 pips from the 150.00 level amid the rumors of FX intervention by the Japanese authorities. Early Wednesday, Japan’s top currency diplomat Masato Kanda said any intervention would not target forex levels but volatility while mentioning that it’s normal for authorities not to comment on whether they intervened or not.

Furthermore, Japan’s Chief Cabinet Secretary Hirokazu Matsuno said on Monday that he will continue to take appropriate steps on FX, but still have no comment on whether Japan intervened in the FX market. It’s worth noting that the 150.00 mark was the level that BoJ intervened last year. Therefore, traders should be cautious before placing aggressive bullish bets on the USD/JPY pair.

Across the pond, Cleveland Federal Reserve President Loretta Mester stated on Tuesday that she is likely to favor an interest rate hike at the next meeting if the current economic situation holds while mentioning that the Fed is likely at or near peak for interest rate target. Atlanta Fed President Raphael Bostic said he will be patient and there is an urgency for us to do anything more.

Apart from this, the number of job openings for August stood at 9.6M from 8.9M (revised from 8.8M) in the previous reading, according to the Job Openings and Labor Turnover Survey (JOLTS) on Tuesday. This figure came in better than the expectation of 8.8 million by a wide margin.

However, the US employment data this week could offer hints about the further monetary policy of the Federal Reserve (Fed). The stronger-than-expected data could lift the Greenback against its rivals.

Market players will keep an eye on the US ADP Employment Change and ISM Services PMI due later in the American session on Wednesday. Meanwhile, the speculations that Japanese authorities will intervene in the FX market remain in traders’ focus. On Friday, the US Nonfarm Payrolls data will be in the spotlight. Traders will take cues from the data and find trading opportunities around the USD/JPY pair.

USD/JPY

OVERVIEW
Today last price149.21
Today Daily Change0.19
Today Daily Change %0.13
Today daily open149.02
TRENDS
Daily SMA20148.21
Daily SMA50146
Daily SMA100143.42
Daily SMA200138.2
LEVELS
Previous Daily High150.16
Previous Daily Low147.32
Previous Weekly High149.71
Previous Weekly Low148.25
Previous Monthly High149.71
Previous Monthly Low144.44
Daily Fibonacci 38.2%148.4
Daily Fibonacci 61.8%149.07
Daily Pivot Point S1147.51
Daily Pivot Point S2145.99
Daily Pivot Point S3144.66
Daily Pivot Point R1150.35
Daily Pivot Point R2151.68
Daily Pivot Point R3153.19
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