© Dukascopy Bank SA
The preceding week has brought no surprises in terms of the USD/JPY currency pair development, as it stayed largely unchanged during those days, despite some movements on Friday, when the pair dropped to 119.3 mark. The economic data from the Japanese side, as usual was limited, except announcement of Japanese salaries, which rose by 0.6% year on year in July, or 0.3% adjusted for inflation, showing the first increase in two years. Meanwhile, a stable majority of Dukascopy respondents did not expect such a development to take place. Now the sentiment was almost acquired by bearish votes.
The middle of the current week is forecasted to bring some important fundamental data, namely the release of revised data on Japanese second quarter economic growth, as well as data on the current account on Tuesday. The next day, Japan is going to announce data on machinery orders and to round up the week with the BSI manufacturing index. From the American side, traders could pay additional attention to the initial jobless claims release on Thursday and Friday's data on producer prices as well as consumer sentiment. Speaking about expectations of Dukascopy Community members, Jignesh thinks that "USD/JPY continues to trace out the moves in the equity markets and the correlation resume to strengthen. Two weeks ago we saw a sell off, but the momentum in buying in the same day indicates that there are buyers present, ready and willing to buy dips. The pair should be supported throughout the week." while RahmanSL believes "Since USD/JPY broke the low but failed to test the higher high, that signals that bulls might be finally exhausted and point to a major spill even to the 116-115 levels."
© Dukascopy Bank SA