USD/JPY holds toward weekly highs in opening hour of Tokyo's trade
|- USD/JPY has stuck to a tight range on the 108 handle between 108.19 and 108.32.
- U.S. Retail Sales support the U.S. Dollar, dialling down Fed cut expectations.
USD/JPY was supported overnight and rallied to a weekly high of 108.37 on solid U.S. data, The US 2-year treasury yields climbed from 1.84% to 1.87% on the Retail Sales, (see below), while 10-year yields climbed from 2.09% to 2.14% before falling back to 2.10% as U.S. stocks stumbled, unable to attract further demand following yesterday's closing record highs.
As for US data, US Retail Rales beat expectations in June, rising 0.4% m/m (0.2% expected) with core sales up a solid 0.7% (0.3% expected):
"US retail sales beat expectations in June, rising 0.4% m/m (0.2% expected) with core sales up a solid 0.7% (0.3% expected). On a 3-month annualised basis, sales are up 7.5% with ex-auto and gas up 6.0%. The gains were fairly broad-based with only electronics seeing a small pullback, suggesting that the consumer is alive and well. Factories were looking less rosy in June though, with industrial production flat on the month, a bit weaker than expected,"
analysts at Westpac explained.
Powell rinses and repeats:
Federal Reserve Chairman Jerome Powell was delivering a speech on "Aspects of Monetary Policy in the Post-Crisis Era" at the "French G7 Presidency 2019 - Bretton Woods: 75 Years Later, Thinking About the Next 75" event in Paris, France. He said that the FOMC participants have raised concerns about a more prolonged shortfall in inflation below our 2 percent target and argued that US growth appears to have moderated.
USD/JPY levels
Valeria Bednarik, the Chief Analyst at FXStreet, explained that the USD/JPY pair has recovered up to a 50% retracement:
"USD/JPY pair has recovered up to the 50% retracement of its latest daily slide at 108.38 but remains within familiar levels.
In the 4 hours chart, the pair has settled above all of its moving averages, which remain directionless and confined to a tight range, reflecting the lack of directional conviction."
"Technical indicators in the mentioned chart recovered up to their mid-lines, losing upward strength around them. The pair peaked last Friday at 108.60 the level to surpass to build a more solid bullish case in the upcoming sessions."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.