Forex trends: yen soars on rise in stocks

image Monday, during Asian deals the Japanese unit gained ground against its main rivals as a drop in most Asian stocks boosted demand for perceived safe haven currencies.

Along with the US dollar yen is considered as a safe-haven currency and both currencies rise, when investors turn risk averse and fell when risk appetite improves.

During early trading, the Australian benchmark index S&P/ASX 200, which fell to 4,537, is currently down with a loss of 54.1 points, or 1.2%, at 4,542. The broader All Ordinaries index is down 50.2 points, or 1.1%, at 4,546. The Japanese benchmark Nikkei, which went tumbling down as stocks across the board wilted under pressure, was down as much as 257.7 points or 2.47% at 10,186.6 at the end of the morning session.

Monday morning in Asia, the yen continued to creep higher versus the dollar, jumping to 90.22, compared to 90.67 hit late Friday in New York. If the yen moves up further, it may test resistance around the 89.8 level.

During Asian deals on Monday, the yen strengthened to 150.08 against the British pound. This set the highest point for the Japanese currency since September 03, 2009. If the yen climbs further, it may likely target the 149.09 level. The GBP/JPY pair closed last week’s deals at 151.21.

Against the currencies of Europe and Switzerland, the yen climbed to an 11-day high of 131.32 and a 10-day high of 86.92, respectively in early Asian deals on Monday. This may be compared to Friday’s New York session closing values of 132.19 and 87.41, respectively. The next upside target level for the yen is seen at 86.46 against the franc and 131.05 against the euro.

In Asian trading today, the yen also gained against commodity related currencies, NZD, AUD and CAD.

The Japanese unit surged higher versus the New Zealand dollar, rising to a 10-day high of 63.10. On the upside, 61.9 is seen as the next target level for the yen. The NZD/JPY pair was worth 64.03 at last week’s close.

Against its Australian counterpart, the yen advanced to an 11-day high of 77.38 in Asian deals on Monday, compared to Friday’s closing value of 78.27. The next upside target level for the Japanese currency is seen at 76.5 against the Aussie.

Against the Canadian currency, the Japanese yen has gained around 3.8% since last Monday to hit an 11-day high of 83.29 today. If the yen ticks up further, the next likely resistance is seen around the 82.3 level. At Friday’s North American session close, the CAD/JPY pair was worth 84.14.


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