Fundamental
Overview
Yesterday, the USD got a
boost from a higher than expected US
CPI report but gave back the gains pretty quickly. There are two reasons
for such a reaction.
The first is that at the
same time of the US CPI release we got the US Jobless Claims figures which jumped
to the top of their yearly ranges. The culprit was attributed mainly to Hurricane
Helene and the strikes.
The second reason is that
the market was already positioned for a higher than expected reading as we’ve
been seeing consistent upside in Treasury yields and the US Dollar in the days
leading up to the release. Therefore, we got a “sell the fact” reaction.
On net, it was a slightly
hawkish report but it looks like the market needs some more reasons to keep
bidding the US Dollar.
USDJPY
Technical Analysis – Daily Timeframe
USDJPY Daily
On the daily chart, we can
see that USDJPY rejected the key swing level at 149.40. The buyers will want to
see the price breaking higher to increase the bullish bets into 152.00 handle
next. The sellers, on the other hand, will keep on piling in around these
levels with a defined risk above the swing level to position for a drop into
new lows.
USDJPY Technical
Analysis – 4 hour Timeframe
USDJPY 4 hour
On the 4 hour chart, we can
see that we have basically created a range between the 147.20 support
and the 149.40 resistance. We will likely need a breakout on either side to increase
the momentum and get a more sustained trend.
USDJPY Technical
Analysis – 1 hour Timeframe
USDJPY 1 hour
On the 1 hour chart, we can
see more clearly the rangebound price action as the bullish momentum waned at
the key 149.40 swing level. There’s not much else we can add here as the market
participants will wait for either a breakout or a catalyst. The red lines
define the average daily range for today.
Upcoming
Catalysts
Today we conclude with the US PPI and the University of Michigan Consumer
Sentiment report.