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Forex Today: Japanese Yen Pares Gains Following Ueda Clarification

By Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

The Japanese Yen gives up most of its recent gains after Governor Ueda clarifies his comments did not mean the Bank was close to abandoning its ultra-loose monetary policy.

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  1. The Japanese Yen has begun to weaken again following clarifications by the Bank of Japan concerning Governor Ueda’s recent remarks about monetary policy, which had been taken to mean the Bank was close to changing its extremely accommodative monetary policy. The clarification was enough to convince the market this was not going to happen soon, which resulted in the Yen giving back most of its recent gains.
  2. Asian stock markets are weak today, led lower by China, where the HIS is trading at a new 2-year low. The main trigger was likely Chinese CPI (inflation) data released late last week showing the Chinese economy is now deflating at an annualized rate of 0.5%.
  3. Stock markets in the USA continue to be bullish, with the NASDAQ 100 Index closing Friday at a near 2-year high closing price. This index and other US indices will be attractive now to trend traders, on the long side. Many analysts see major US stock indices as likely to reach new all-time highs during 2024.
  4. In the Forex market, since the Tokyo open, the Swiss Franc has been the strongest major currency, while the Japanese Yen has been the weakest. There do not seem to be any valid long-term trends to exploit in this asset class right now, with the US Dollar’s direction looking uncertain before US CPI data is released.
  5. Bitcoin is falling heavily from its recent 18-month high above $44,000. It remains to be seen whether it stabilizes as it reached support levels, where trend traders may still find new long trade entries.
  6. Cocoa futures ended last week Friday at a multi-year high weekly closing price.
  7. It is likely to be a relatively quiet day in the market, as it is a Monday and as there are no high-impact economic data releases scheduled for today.
Adam Lemon
About Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

 

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