- The US dollar advances 0.59% in the week vs. the Japanese yen.
- Higher US T-bond yields rise three basis points to close to 1.50%.
- USD/JPY Price Forecast: It has an upward bias, though accelerating the trend would need a break above 114.70.
The US dollar extends its rally against the Japanese yen, advancing for the third consecutive day, trading at 114.36 during the New York session at press time. Positive news on the Covid-19 Omicron-variant front is cheered by investors as the Santa Rally finally kicked in. European equity indices rise between 0.93% and 1.42%, while US stock indices advance between 0.62% and 0.70%.
The US Food and Drug Administration (FDA) has authorized Covid-19 treatments in the last two days. On Wednesday, it approved Pfizer’s Plaxovid, treatment for high-risk patients. By Thursday, Molnupravir, a treatment pill developed by Merck, received the green light from the FDA. Both treatments would help to curb rising infections from overwhelming hospitals.
US T-bond yields rallied on the news, with the 10-year US Treasury yield rising three basis points, closing at 1.50%, and underpining the USD/JPY. In the meantime, the US Dollar Index, which tracks the buck’s performance against a basket of six rivals, is barely up 0.03%, at 96.10.
USD/JPY Price Forecast: Technical outlook
The USD/JPY daily chart depicts the pair has having an upside bias, supported by the daily moving averages (DMAs) residing below the spot price. Additionally, an upslope trendline drawn from the September swing lows towards the late November lows stalled sell-offs moves three times.
To the upside, the USD/JPY's first line of resistance would be the October 20 cycle high at 114.70. A breach of the latter could pave the way for further USD/JPY gains. The next resistance would be the psychological 115.00 figure, followed by the November 24 cycle high and YTD high at 115.52.
On the flip side, the USD/JPY's first demand zone would be the 50-DMA at 113.87. A break beneath that support would open the door for a test of the upsloping trendline around the 113.60-75 range, followed by the December 17 pivot low at 113.14.
-637758749278709639.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.