USD/JPY sees retreat amid US Dollar weakness

Andrey Goilov RoboForex

USD/JPY has retreated from its peak this week, settling at 146.82. The yen gained some strength as the US dollar weakened following July's lacklustre US Producer Price Index (PPI) data. This report bolstered market expectations for a potential 50 basis point cut by the Federal Reserve at its upcoming September meeting.

The focus now shifts to the July US Consumer Price Index (CPI), due for release today. Market participants predict sharp reactions if the data is weaker than expected, reinforcing the case for further rate cuts.

Domestically, the Tankan report indicated a decline in business confidence in Japan in August, likely influenced by reduced demand from China and other external pressures. This decrease to 10 points from 11 reflects Japan's broader economic challenges.

Additionally, the Bank of Japan’s (BoJ) monetary policy outlook remains a critical focal point amid recent stock market volatility and decreased carry trade activities involving the yen. While a former BoJ official expressed doubts about the possibility of an interest rate increase this year due to financial market impacts, the broader market remains cautiously optimistic about future monetary tightening.

Technical Analysis of USD/JPY

The USD/JPY forecast shows that the pair is currently consolidating around the 147.00 level. We anticipate a corrective decline to 145.00, followed by a potential rebound towards 152.22. A breach of this level could extend the upward trend towards 159.52. This bullish outlook is technically supported by the MACD indicator, which, although its signal line is below zero, suggests downward momentum.

On the hourly chart, USD/JPY continues its corrective phase with a target set at 145.80. The pair is currently stabilising around 146.55, setting the stage for a potential decline to 145.60, and possibly extending the correction to 145.00. This scenario is corroborated by the Stochastic oscillator, with its signal line poised to move from below the 80 level to the 20 level, suggesting potential further declines.

Author

Andrey Goilov

RoboForex

Higher economic education. Andrey Goilov has been working on the Forex market since 2005. A financial analyst and successful trader. Preference in trading is highly volatile instruments.

EUR/USD hovers around nine-day EMA above 1.1800

EUR/USD remains in the positive territory after registering modest gains in the previous session, trading around 1.1820 during the Asian hours on Monday. The 14-day Relative Strength Index momentum indicator at 54 is edging higher, signaling improving momentum. RSI near mid-50s keeps momentum balanced. A sustained push above 60 would firm bullish control.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold sticks to gains above $5,000 as China's buying and Fed rate-cut bets drive demand

Gold surges past the $5,000 psychological mark during the Asian session on Monday in reaction to the weekend data, showing that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Federal Reserve expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Weekly column: Saturn-Neptune and the end of the Dollar’s 15-year bull cycle

Tariffs are not only inflationary for a nation but also risk undermining the trust and credibility that go hand in hand with the responsibility of being the leading nation in the free world and controlling the world’s reserve currency.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.