USD/JPY hits new 7 year highs as dollar resumes strength

Has the US dollar correction already ended? USD/JPY went all the way from the round 114 line to the previous highs at 115.50 and continued higher, rising to 115.73 at the time of writing. The high so far is 115.79.

Can it reach 116 soon? Is 120 not too far away?

Japan’s current account showed a larger than expected surplus of 0.43 trillion for September. A marginal surplus of 0.03 trillion was expected.

Earlier, Japan’s economy watches index actually dropped from 47.4 to 44 points in April. The government says the economy is showing signs of weakness. Well, perhaps this could trigger more stimulus from the Bank of Japan. Bankruptcies in Japan recorded a drop of 16.57% year over year, after rising 0.85% in September. This is a third tier indicator.

There are rumors that Japanese PM  Shinzo Abe may  dissolve the parliament in Tokyo on the background of the delay of the second tax hike. Sources continue saying that the next tax hike will likely be delayed.

The Japanese yen is falling also against the Australian and Canadian dollars, setting new multi-year lows against these commodity currencies, which aren’t doing too good against the greenback  themselves.

For more, see the Japanese yen forecast. Here is how it looks on the chart::