On Friday of last week the USDJPY saw broad dollar strength after U.S. President Trump and the Democrats reached a provisional agreement to avoid a government shutdown, while speculation grew that the hawkish Kevin Warsh would be nominated as the next FRB Chair. Trading for the week closed at a high of 154.79 in New York, up from a low of 152.86 shortly after the open.

Today the USDJPY opened with a gap up, with yen selling triggered by confirmation that the BOJ had not intervened in the currency market and by remarks from Prime Minister Takaichi's speech. The pair reached a high of 155.51 around GMT 23:00 but has since softened, trading in the 154.8-yen range as of GMT 05:00.

Looking at the 1-hour chart of the USDJPY (as of GMT 05:20 on February 2), the price continues to move above the middle line and has been pushed back after moving outside the Bollinger Band. If the pair breaks above 155 yen again, it would seem appropriate to maintain an upward outlook

(20-period Bollinger Band, showing ±1 and ±2 standard deviations)

The main economic indicators for today are as follows:

• GMT 14:45 U.S. January Manufacturing Purchasing Managers Index (PMI, revised)
• GMT 15:00 U.S. January ISM Manufacturing PMI