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FOREX: USDJPY Recovers to Prior Breakdown Point, Futures Activity Buoyant

FOREX
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  • USDJPY extends the recovery off the lows to roughly 100 pips, and briefly tests the overnight breakdown level of 141.70 in recent trade. The pair has been assisted by the moderate recovery for major equity benchmarks, although remains 0.6% lower on the session amid the extended decline for core yields.
  • Heightened volatility following last night’s US presidential debate is evident by JPY futures volumes roughly 40% above what you’d expect to see for 0930BST.
  • Furthermore, BoJ board member Junko Nakagawa reiterated overnight that the BoJ will adjust the degree of easy policy if the economy realises the bank’s forecast for the economy and prices as real interest rates remain at considerably low levels. US-JP yield differentials are lower at the front, the spread at +317bps, levels last seen in August 2022.
  • Ahead of the significant US CPI release, downside focus will remain on intra-day lows of 140.71 and then 140.25, the Dec 28 low from last year and key support. Resistance is not seen until 143.71, the Sep 9 high. Our full preview is here: https://media.marketnews.com/USCPI_Prev_Sep2024_66514cfe2d.pdf
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  • USDJPY extends the recovery off the lows to roughly 100 pips, and briefly tests the overnight breakdown level of 141.70 in recent trade. The pair has been assisted by the moderate recovery for major equity benchmarks, although remains 0.6% lower on the session amid the extended decline for core yields.
  • Heightened volatility following last night’s US presidential debate is evident by JPY futures volumes roughly 40% above what you’d expect to see for 0930BST.
  • Furthermore, BoJ board member Junko Nakagawa reiterated overnight that the BoJ will adjust the degree of easy policy if the economy realises the bank’s forecast for the economy and prices as real interest rates remain at considerably low levels. US-JP yield differentials are lower at the front, the spread at +317bps, levels last seen in August 2022.
  • Ahead of the significant US CPI release, downside focus will remain on intra-day lows of 140.71 and then 140.25, the Dec 28 low from last year and key support. Resistance is not seen until 143.71, the Sep 9 high. Our full preview is here: https://media.marketnews.com/USCPI_Prev_Sep2024_66514cfe2d.pdf