JPY Bulls Dominate Amid Development Slowdown and Wrongfooted Speculators

JPY Evaluation and Speaking Factors

JPY Advances as China Sparks Detrimental Threat Tone

Market Positioning Leaves USDJPY Weak

China Offers New 12 months Reminder that Development is Slowing

The Japanese Yen made advances all through the Asian session after shares took successful following the newest China information. Caixin Manufacturing PMI fell to 49.7, lacking analyst estimates of 50.2 and extra importantly, transferring into contraction territory for the primary time since Might 2017. That stated, this reaffirms the view that international development is certainly slowing down, which in flip ought to preserve the JPY on the entrance foot towards its main counterparts after regaining its attract in occasions of danger off. USDJPY now buying and selling on the lowest stage since June 2018 following the break under 109, eyes at the moment are on the Might low at 108.11.

Wrongfooted Speculators to Exacerbate JPY Shopping for

Regardless of the slide in USDJPY all through final month, speculators remained bearish on the JPY, which accounts roughly a 3rd of USD lengthy positions. The newest CFTC information from December 21st confirmed JPY internet shorts totalling $11.4bln, whereas USD internet longs hit $29.5bln. As such, USDJPY could effectively see present losses exacerbate on quick overlaying as the elemental backdrop softens.

JPY Bulls Dominate Amid Growth Slowdown and Wrongfooted Speculators

Supply: Reuters. CFTC Speculative Positioning.

USDJPY Value Chart: Weekly Time Body (Feb 2015 -Jan 2019)

JPY Bulls Dominate Amid Growth Slowdown and Wrongfooted Speculators

Bearish momentum in USDJPY has proven little indicators of abating anytime quickly amid the break under the 38.2% Fibonacci retracement. An in depth under might see the pair transfer in direction of 108.11, which marks the Might 2018 low. Of be aware, my high commerce for 2019 is to quick USDJPY


— Written by Justin McQueen, Market Analyst

To contact Justin, e mail him at

Observe Justin on Twitter @JMcQueenFX

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