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USD/JPY Peaks at a Multi-Year High Above 115.50 as Dollar Rallies

The USD/JPY pair reaches what could be an inflection point at 115.50, a multi-year high. US dollar gains across the board.

SageFX - Nov, 25, 21

*Sage FX would like to state that traders should research extensively before following any information given hereby. Any assumptions made in this article are provided solely for entertainment purposes and not for traders to guide or alter their positions. Please read our Terms & Conditions and Risk Disclosure for more information.

Principal Points

  • USD/JPY peaks at 115.50, a level last seen in March 2017 as US dollar gains broadly
  • The level could be an inflection point as price has consolidated in search of direction

What’s Moving in the Markets?

The USD/JPY pair has reached a multi-year high as broader US dollar strength defines the forex market this week. As a result, the exchange rate peaked above 115.50 late on Wednesday. In other words, the USD/JPY briefly traded at levels last seen in March 2017.

That said, traders and investors are now looking to find out whether the pair will turn at this inflection point. In more detail, the USD/JPY has consolidated and is presently trading near 115.40 as the US session approaches.

To this end, stocks on Wall Street today will take a break as Americans celebrate Thanksgiving Day. While the NYSE and the Nasdaq will not be operating, currency markets will remain open.

What’s the Big Picture for Traders?

Several important events this week have set the course for financial markets. Most notable include the release of the Federal Reserve minutes from its last meeting. On this note, Fed officials expressed concerns over rising inflation and considered tapering at a quicker pace.

In November, the US central bank will initiate its reduction of monetary stimulus. That means the Fed will unwind the $120 billion in monthly asset purchases by $15 billion a month. If needed, the minutes show, Fed policymakers could increase the speed of scaling down the monetary support.

Additionally, during the Fed’s meeting on Nov. 2-3, some officials suggested raising interest rates sooner than expected. Previously, the consensus pointed to higher rates in mid-2022. Now, to cool off the economy, the first rate hike could materialize in the first half of next year.

Also, weekly jobless claims dropped to their lowest level since 1969. More precisely, 199,000 first-time filings for unemployment benefits were received last week by the Labor Department. The report easily beat estimates of 260,000 new filings. It also arrived below the preceding week’s 270,000.

What to Watch in Cryptocurrency?

Meanwhile, the cryptocurrency market keeps a quiet tone early Thursday. More specifically, the price of bitcoin is gyrating near $57,000. The level turned into a consolidation zone for the orange coin over the past week.

With this in mind, traders in the digital asset space anticipate the next strong catalyst that would stir the market.

It’s important to note that, in signs of crypto expansion into traditional finance, Morgan Stanley held bitcoin products. That could be seen in the bank’s latest filings with the Securities and Exchange Commission.

In detail, banking giant Morgan Stanley bought 1.5 million shares of the Grayscale Bitcoin Trust (GBTC) in the third quarter. For the purchase, the bank used one of its funds called Growth Portfolio Fund. Moreover, several other funds owned by the bank also held bitcoin products through the quarter ended September.

Economic Data Coming Up Today (EST times)

On Thursday, as US traders take a break from stocks, European Central Bank President Christine Lagarde will speak at 08:30 am. Next, at 12:00 pm, Bank of England Governor Andrew Bailey is slated to speak. Later, at 07:30 pm, Australia will release its retail sales report.


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