USD/JPY Forecast Aug. 19-23 – Yen slips as dollar punches past 106
Majors, USD JPY Forecast, Weekly Forex Forecasts

USD/JPY Forecast Aug. 19-23 – Yen slips as dollar punches past 106

Dollar/yen posted considerable gains last week, as the greenback rebounded after two straight weeks of losses. Investors will be keeping a close eye on the Federal Reserve minutes, which will provide details from the July policy meeting, when the Fed lowered rates for the first time in a decade. As well, we can expect trade tensions and stock market movement to have a significant influence on the pair’s movement.

USD/JPY fundamental movers

The U.S-China trade war saga continues.  President Trump announced a delay on new U.S. tariffs against China, which were set to take effect on September 1. Still, tensions between the world’s two largest economies remains high, and the mass demonstrations in Hong Kong and the Chinese regime could lead to a further deterioration in U.S-China relations and could shake up the financial markets.

In the U.S., there was positive news from consumer inflation and spending numbers. CPI climbed 0.3% in July, matching the forecast. Core CPI remained steady at 0.3%, beating the forecast of 0.2%. Retail sales rose 0.7%, easily beating the estimate of 0.4%. Core retail sales sparkled with a gain of 1.0%, its best showing since March. On the manufacturing front, the Philly Fed Manufacturing Index slowed to 16.8, but still beat the estimate of 10.1.

See all the main events in the  Forex Weekly Outlook

Key news updates for USD/JPY


USD/JPY Technical Analysis

We start with 109.73, which has held in resistance since the end of May. 109.35 is close by.

108.70 follows.

108.10 was a swing low in late May.

107.30 has held in resistance since the first week in August.

106.61 remains relevant. It starts the new trading week as a weak resistance line.

105.55 (mentioned last week) is the first line of support.

104.65 is next.

The round number of 104 was a key line in May 2008.

102.50 is the final support line for now.

USD/JPY Daily Chart

USD/JPY Sentiment

I am bearish on USD/JPY

The escalating feud between the U.S. and China is weighing on the Japanese economy, but investor risk appetite is low, which could boost the safe-haven yen. With stock markets showing sharp volatility due to fears of a recession in the U.S., there is upside for the Japanese currency.

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Safe trading!

Kenny Fisher

Kenny Fisher

Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.