[September 5 Analysis Report] Cross currencies: is selling the only option from here on?
with a potential termination
Hello, this is Leo.
This time,From Monday, August 31, 2026 to Friday, September 4, 2026we will review the market.
Looking at this week's market, what I am particularly watching is
.
Historically, Cross Yen has tended to be perceived asan uptrend with pullbackseven when there were occasional declines.
However, when looking at recent price action, the premise itself is gradually needing to change.
Cross Yen until now favored a “buy” stance
When reviewing Cross Yen in recent years,
Even during pullbacks,
was easier to consider as an advantage.
Therefore, for a long time I viewed Cross Yen mainly from thebuying-sideperspective.
However, a sizable decline occurred across Cross Yen some time ago.
Among the factors, it was important that
currency pairs began breaking the daily-chart support lows.
In particularCHF/JPY (Swiss franc yen)is quite clear: it broke through a critical level that had supported the previous uptrend.
From around this area,
is becoming less of a market rule.
This week saw further yen buying accelerate
And that momentum was amplified this week.
The yen was bought aggressively against the dollar, and the general yen-buying trend stood out across Cross Yen as well.
Even CHF/JPY fell sharply throughout the week, and as before
we cannot simply think,
“it fell, so buy the dip.”
With daily lows already broken for some pairs, and further declines this week,
Cross Yen buying has become considerably harder to initiate.
Yen buying can also be explained by fundamentals
This yen strength isn't happening only in charts.
In the market, expectations for the Bank of Japan's future rate hikes are being priced in.
The BOJ's next monetary policy meeting is
September 17–18
Ahead of this, the long-standing trend ofyen selling and high-yielding currencies buyingcould start to change.
In other words, currently we are in a state of
Cross Yen is starting to break down
yen-buying factors are being priced in
This is very important, I think.
Looking at Japan's economy alone, yen buying isn't the only dominant trend
However, it's not as if there are only yen-strength catalysts.
In the July household survey released on September 4,real consumption expenditure for households with two or more people fell 3.6% year over year.
This is a cautious factor for the BOJ in terms of whether the environment allows immediate rate hikes.
Therefore,a stronger yen does not automatically mean Cross Yen will crash straight downeither.
What I am watching is
is starting to break down
A week of important indicators in the U.S. as well
In the dollar side, important releases continued this week.
U.S. ISM Manufacturing PMI
54.6
U.S. ISM Services PMI
55.4
U.S. Employment Situation
Non-farm payrolls+162,000
Unemployment rate4.1%
Following Friday's U.S. payrolls, the dollar rebounded.
In other words, the dollar isn't in a pure selling regime.
Dollar-streets (dollar pairs) are also showing signs of change
Another area I am watching is,Dollar crosses.
Looking at EUR/USD, GBP/USD, AUD/USD, etc., price action is starting to diverge from the past pattern.
Therefore, currently we may see a shift toward
as the market moves forward.
Of course, judging from Friday's strong U.S. payrolls, I do not think dollar selling is settled yet.
What matters is
that the balance of market forces is starting to change
compared to the past.
My current scenario
Until now, Cross Yen followed a pattern where
This flow has been very effective in the past.
But now
↓
② broad decline across Cross Yen
↓
③ further yen buying this week
↓
④ expectations for BOJ policy
are causing a shift.
Therefore,the fixed notion of “Cross Yen = buy”should be set aside for a while.
Upward trend ends, price bounces within a high range.
Cross Yen as a whole shifts into a full-on downtrend.
At present, there is no need to decide which scenario will occur.
What matters is
From next week, focus on trend turning points
Next week looks set to be an interesting market.
In particular, I want to notethe Cross Yen daily and 4-hour pullbacks.
Previously, scenes like
“it fell, so buy the dip”
were acceptable, but now we must watch
“will it rebound from a pullback or not?”
.
At the same time, in dollar crosses, we want to confirm whether pullbacks will be bought again.
✓ Some currency pairs broke daily short-term lows
✓ A week with strengthening yen-buying flow
✓ Expectations for BoJ policy influenced the yen market
✓ September 4 Japan household expenditures year over year -3.6%
✓ September 1 U.S. ISM Manufacturing 54.6
✓ September 3 U.S. ISM Non-Manufacturing 55.4
✓ September 4 U.S. employment report: +162k, unemployment 4.1%
✓ Signs of change also in dollar crosses
✓ Cross Yen shifting from “buying only” to range-bound and downtrend cautions
This article is for market analysis and information purposes and does not recommend buying or selling specific currencies or financial instruments. Market conditions are always changing. Please trade based on your own judgment and responsibility.
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