Will dollar stick to its Oct winning streak versus yen?
Oct 1 (Reuters) -Will the U.S. dollar extend its winning streak against the yen in October, or will USD/JPY's typically positive seasonal trend be bucked?
A study of USD/JPY's seasonal performance for each October since 2000 shows it has posted a positive return in 16 of the last 24 years, including in 2021, 2022 and 2023. However, seasonality should not be considered in isolation, it must be corroborated by other factors.
USD/JPY failed to close above the broken 144.86 Fibo, a 23.6% retrace of the 161.96 to 139.58 (July to September) EBS drop, last week. That set up a bull trap, which is usually a bearish sign. Therefore USD/JPY bulls need to force sustained trading for multiple sessions above the 144.86 Fibo in order to increase the chance of spot closing in positive territory in October.
Expectations that the Federal Reserve and Bank of Japan rates will partially converge through to the end of 2025 have weighed on USD/JPY recently. However, Fed Chair Jerome Powell's relatively hawkish monetary policy guidance on Monday could help USD/JPY higher in the short-term.
For more click on FXBUZ
USD/JPY Seasonality Chart: https://tmsnrt.rs/3Y7Na7j
Daily Chart: https://tmsnrt.rs/3Y5STdO
Martin Miller is a Reuters market analyst. The views expressed are his own; Editing by Kevin Liffey
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
