• Contact Us
  • Homepages
Most Forex
  • For Beginners
  • Strategies
  • Technical Analysis
  • Product Reviews
  • News
  • Videos
No Result
View All Result
  • For Beginners
  • Strategies
  • Technical Analysis
  • Product Reviews
  • News
  • Videos
No Result
View All Result
Most Forex
No Result
View All Result
Home Forex News

Japanese Yen May Rise With Covid Lockdowns Threatening Nikkei 225 Outlook

Forex Tips by Forex Tips
November 21, 2020
in Forex News
0
189
SHARES
1.5k
VIEWS
Share on FacebookShare on Twitter


USDJPY Chart

Chart created with TradingView

Japanese Yen Fundamental Forecast: Bullish

  • Anti-risk Japanese Yen rose as US growth outlook deteriorated
  • Covid cases, lockdowns, fiscal woes may keep USD/JPY lower
  • Nikkei 225 may be at risk, Thanksgiving liquidity drain ahead

Japanese Yen, USD/JPY Recap

The Japanese Yen spent most of this past week trading higher against its major counterparts, including the US Dollar. USD/JPY aimed lower as Treasury yields weakened, making government bonds in Japan relatively more attractive to investors. In fact, following some divergence ahead of the US presidential election, USD/JPY now seems to be tracking bond yield spreads between the US and Japan again – see chart below.

The US yield curve flattened as longer-dated government bond returns declined, signaling fading confidence in the medium-term outlook. Investors appear to be focusing on the record pace in local Covid-19 case growth rather than on positive vaccine news. As the nation reached hospitalization highs, California imposed a late curfew for about 94% of its residents. Texas saw 12,293 cases, beating a previous record from the summer.

Building Confidence in Trading

Building Confidence in Trading

Recommended by Daniel Dubrovsky

Don’t give into despair, make a game plan

Week Ahead

Going forward, the anti-risk Japanese Yen appears to be in an optimal position. A lack of expediency in fiscal support from the US poses a threat for both local and external equities. This is underscored if more states take measures to impose lockdowns to help contain the spread of the disease. The International Monetary Fund (IMF) warned last week that the global recovery appears to be losing momentum.

Meanwhile in Japan, cases were also setting records. This caused Tokyo to raise its Covid-19 alert status to its highest level. While policymakers refrained from imposing lockdowns, they urged citizens to be more cautious. The Nikkei 225, Japan’s benchmark stock index, halted its impressive winning streak from earlier this month after closing at its highest since 1991.

For updates on developments in the Japanese Yen and risk trends, make sure to follow me on Twitter @ddubrovskyFX

Finance Minister Taro Aso mentioned that they ‘must stimulate sentiment with fiscal policy’. His tone echoes what the Federal Reserve has been stressing in the US. FOMC minutes may continue to reiterate this message with consumer sentiment also on tap. The latter could disappoint given rising coronavirus cases. It will also be a shortened trading week due to the Thanksgiving holiday, opening the door to lower levels of liquidity.

Forex for Beginners

Forex for Beginners

Recommended by Daniel Dubrovsky

How can central banks impact markets?

USD/JPY and Government Bond Spread Relationship

Japanese Yen May Rise With Covid Lockdowns Threatening Nikkei 225 Outlook

Chart Created in TradingView

— Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter





Source link

Share76Tweet47

Related Posts

S&P 500 Rallies as Key Insiders Dump Stock, Traders Add Shorts

Strong NFP and Stimulus to Lead the Way Higher

by Forex Tips
March 8, 2021
0

S&P 500, HANG SENG, ASX 200, ASIA-PACIFIC MARKET WEEKLY OUTLOOK:Wall Street equities rebounded on strong non-farm payrolls report, retreating...

Euro Coiling Up for a Breakout?

EUR/USD to Weaken if ECB Increases Bond Buying

by Forex Tips
March 7, 2021
0

Fundamental Euro Forecast: NeutralThe recent sharp rise in sovereign bond yields, including those issued by Eurozone governments, has clearly...

FX Week Ahead – Top 5 Events: US Inflation; BOC & ECB Rate Decisions; UK GDP; Canada Jobs

by Forex Tips
March 6, 2021
0

FX Week Ahead Overview:Bond markets will be on edge all week, with several measures of inflation due from around...

How to Short Sell a Stock When Trading Falling Markets

How to Short Sell a Stock When Trading Falling Markets

by Forex Tips
March 5, 2021
0

Shorting a stock involves selling a borrowed stock in the anticipation of buying the same stock back at a...

Dow Jones Eyes Support, Straits Times Faces Singapore General Election

Copper Trading Tips and Strategies

by Forex Tips
March 4, 2021
0

Copper Trading: Copper Trading Tips and StrategiesCopper is a highly tradeable commodity.Copper is priced in US Dollars; so the...

Load More

Categories

  • Crypto Strategies
  • Currency
  • For Beginners
  • Forex News
  • Forex Trading Tips & Strategies
  • Investment
  • Technical Analysis
  • Videos
Forex Pulse Detector

Categories

  • Crypto Strategies
  • Currency
  • For Beginners
  • Forex News
  • Forex Trading Tips & Strategies
  • Investment
  • Technical Analysis
  • Videos

Newsletter

  • Home
  • Contact
  • Privacy Policy
  • Store

© 2018 Forex Blog

No Result
View All Result
  • Contact Us
  • Homepages

© 2018 Forex Blog.