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30 Sep 2013
USD/JPY plunges amidst Italian “jitters”, US potential debt default
FXstreet.com (Athens) – The USD/JPY is heading sharply downwards after having already opened lower with a huge gap in the kick-off of the Asian trading session.
USD/JPY falling apart to one month low on a very tricky end of the month
The USD/JPY can’t help itself to regain an uptrend momentum, amidst on political jitters on Italy and the US. Elaborating on, today is the last day of the fiscal year in US and US politicians don’t give any sign of looking towards a compromise. Thus, investors should not find it out of the blue that risk-off sentiment prevails across the board all over the globe, dragging down immensely the JPY crosses, i.e. the Japanese currency is outperforming. Generally, we are witnessing major political turmoil as the US is facing a government shut-down for the first time in 17 years unless a deal on a budget is reached today, while the Italian government is looking incredibly unstable after Berlusconi withdrew his support for the current coalition. Finally, political uncertainty remains also well in “play” in the power horse of Euro land, as ECB's Coure said earlier in news wires that “there's a "sense of frustration" on SRM progress.”
Technical Outlook and Strategic Bias on USD/JPY
Emmanuel Ng of OCBC Bank, mentions that the we are still slightly uncomfortable with undue upside for the USD/JPY in the near term despite slightly firmer US yields and Japanese corporate tax headlines. With investor sentiment on edge with respect to the US fiscal situation, the pair may have to overcome resistance around the 99.00 area convincingly to establish a foothold, and failing which, a relapse back towards the 55-day MA (98.68) cannot be ruled out.”
USD/JPY falling apart to one month low on a very tricky end of the month
The USD/JPY can’t help itself to regain an uptrend momentum, amidst on political jitters on Italy and the US. Elaborating on, today is the last day of the fiscal year in US and US politicians don’t give any sign of looking towards a compromise. Thus, investors should not find it out of the blue that risk-off sentiment prevails across the board all over the globe, dragging down immensely the JPY crosses, i.e. the Japanese currency is outperforming. Generally, we are witnessing major political turmoil as the US is facing a government shut-down for the first time in 17 years unless a deal on a budget is reached today, while the Italian government is looking incredibly unstable after Berlusconi withdrew his support for the current coalition. Finally, political uncertainty remains also well in “play” in the power horse of Euro land, as ECB's Coure said earlier in news wires that “there's a "sense of frustration" on SRM progress.”
Technical Outlook and Strategic Bias on USD/JPY
Emmanuel Ng of OCBC Bank, mentions that the we are still slightly uncomfortable with undue upside for the USD/JPY in the near term despite slightly firmer US yields and Japanese corporate tax headlines. With investor sentiment on edge with respect to the US fiscal situation, the pair may have to overcome resistance around the 99.00 area convincingly to establish a foothold, and failing which, a relapse back towards the 55-day MA (98.68) cannot be ruled out.”