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Highs Displayed as Speculative Positions Wagered


The USD/JPY is trading near important near-term highs as financial houses and large speculators are likely positioning wagers before tomorrow’s important U.S. inflation statistics.

The USD/JPY is near the 132.690 ratios as of this writing as it traverses within the higher realms of its near-term price range. The USD/JPY has produced choppy conditions past week of trading as it still seemingly reacts to the stronger than anticipated U.S jobs numbers published on the 3rd of February. Clearly, financial houses have been looking to create equilibrium in the USD/JPY after having to acknowledge their outlooks regarding a more dovish U.S. Federal Reserve needed to be put on hold momentarily.


The yen is a popular asset during turbulent times.

The USD/JPY reached a high of nearly 132.920 last Monday and then traded towards a low achieved on Friday near the 129.815 level before reversing higher as the day finished.  Early trading this morning has seen another flourish higher, but resistance levels continue to create technical moves lower also, as trading positions are likely being set before tomorrow’s key U.S Consumer Price Index statistics.

Tuesday’s U.S Inflation Numbers will create a Looking Glass for the USD/JPY

Trading today and tomorrow should be monitored closely by day traders looking to pursue the USD/JPY and volatility needs to be expected, certainly in the hours before and after the U.S CPI results are reported. The ability of the USD/JPY to trade higher and within sight of near-term apex values may indicate financial houses are nervous about the potential of higher-than-expected inflation numbers from the U.S. emerging tomorrow.  

However, if the CPI numbers meet expectations or are weaker than anticipated this could cause an intriguing reaction in the USD/JPY which may generate selling. The USD/JPY it should be noted tested important lows late last week and this needs to be considered by speculators as they pursue the currency pair.

The mid-term trend of the USD/JPY has been bearish, and the past ten days have certainly seen upwards momentum, the table is set for fast price velocity tomorrow. The results of the CPI data from the U.S. will likely cause a chain reaction in Forex including the USD/JPY regarding direction over the next few days.

Dynamic and Volatile Conditions will be Delivered Tomorrow

  • Traders should monitor short-term resistance carefully, if the 132.700 ratio is toppled and sustained it likely points to nervous behavioral sentiment within financial houses before tomorrow’s U.S inflation numbers.
  • Traders tempted to sell the USD/JPY near the current near-term highs cannot be blamed, but they would be betting against the short-term trend and should use strong risk management.

Day traders should be ready for a test of the current price level today, but the potential also exists that massive volatility will develop in the USD/JPY sooner than expected. If this occurs whipsaw movements could be dangerous as support and resistance levels are challenged swiftly.

USD/JPY Short-Term Outlook:

Current Resistance: 132.775

Current Support: 132.395

High Target: 133.085

Low Target: 130.625



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