USD/JPY: Traders getting set for a roller-coaster week ahead

• On a busy week ahead, USD/JPY made decent gains, rising from 106.80 to a high of 107.34 scored today in Asia.
• Trade talks a thorn in the bull’s sides – President Trump said a partial trade deal is “not what we prefer at all”.

USD/JPY made decent gains, rising from 106.80 to a high of 107.34 scored today in Asia. The main theme surrounding the Yen comes as the week will unfold key trade talks and various calendar data events for the US – indeed, it should be a key week for USD/JPY traders seeking direction.  We will have the likes of US Consumer Price Index, more comments from Federal Reserve Powell, the Federal Open Market Committee minutes and trade talks.

Overnight,  the headlines surrounding the  US-China relations were mixed:

Trade talk sentiment kicks off with a mixed set of headlines

“White House advisor Kudlow said that delisting Chinese companies from US share markets were not on the table and a news report claimed that China was ready to reach agreement on selected areas, leaving difficult topics to be revisited next year,” analysts at Westpac explained.

Meanwhile, President Trump said a partial trade deal is “not what we prefer at all”. He said while hosting the Japanese and US trade deal sign off, that he has hopes for this weeks trade talks – “We will have to see.”

In the same vein, however, “the US Commerce Department announced 28 additional Chinese organizations had been added to a trade blacklist. The Commerce statement said that “these entities have been implicated in human rights violations and abuses in the implementation of China’s campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups” in Xinjian,” analysts at Westpac added.  

Eyes on the Fed

With respect to the Fed. we had Kansas City Fed president George, speaking saying that moderation in growth this year had  been in line with her outlook. She repeated that the  economy remains in a good place, but is keeping a close eye on consumer confidence; Should that deteriorate, she would revise her outlook. Fed’s Kashkari said he is happy the Fed is cutting rates but isn’t sure how much more is needed.

USD/JPY levels