Japanese Yen Prices, Charts, and Analysis

• All monetary policy levers remain unchanged, for now.
• USD/JPY prints a fresh three-month low.

Learn How to Trade USD/JPY with our Complimentary Guide

The Japanese Yen is strengthening against a range of currencies today after recent Bank of Japan commentary suggested that the central bank may be looking at various ways of ending its ultra-loose monetary policy. According to BoJ deputy governor Ryozo Himino, ending the current ultra-loose monetary policy would not harm the economy, while governor Kazuo Ueda noted that the central bank has not decided which interest rate to look at it when the BoJ finally ends their negative interest rate policy. This faintly hawkish messaging was countered by governor Ueda adding that Japan’s economy is still struggling and will continue to do so in 2024.

USD/JPY reacted to today’s comments by sliding to a fresh three-month low. Looking to the months ahead, if the US starts to reduce interest rates – 125 bp of rate cuts are forecast by the Fed in 2024 – and the Bank of Japan leaves policy unchanged - or even starts to tighten policy - the rate differential between the two currencies will narrow, pushing USD/JPY lower.

After posting a multi-decade high of 151.91 on November 13th, USD/JPY has moved lower as fears of central bank intervention capped any further upside. Today’s sharp turn lower now sees USD/JPY trade around 145.30 and further losses cannot be discounted. The pair trades below the 20- and 50-day simple moving averages and a break below the 145 level would bring into focus the 200-day sma at 142.26.

USD/JPY Daily Price Chart – December 7, 2023

Retail trader data shows 27.40% of traders are net-long with the ratio of traders short to long at 2.65 to 1.The number of traders net-long is 1.71% lower than yesterday and 0.43% lower than last week, while the number of traders net-short is 5.47% lower than yesterday and 11.03% lower than last week.

What is your view on the Japanese Yen – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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