- USD/JPY goes into consolidation around 110.50 on Wednesday.
- US Dollar Index stays in the negative territory around 92.60.
- Focus shifts to FOMC Chairman Jerome Powell's testimony.
The USD/JPY pair closed the previous three trading days in the positive territory and touched its highest level in a week at 110.71 in the early Asian trading hours on Wednesday. However, the pair lost its bullish momentum ahead of the American session and was last seen posting small daily losses at 110.50.
DXY edges lower, eyes on Powell's testimony
On Tuesday, the benchmark 10-year US Treasury bond yield gained nearly 4% following the dismal 30-year note auction and helped USD/JPY push higher. Moreover, the June inflation report, which showed that the annual Consumer Price Index (CPI) jumped to 5.4% from 5%, provided an additional boost to the greenback. The US Dollar Index (DXY) rose 0.6% on a daily basis and posted its largest percentage gain since mid-June.
On Wednesday, the DXY is trading with modest losses around 92.60 as investors stay on the sidelines ahead of key events. Meanwhile, the 10-year US T-bond yield is down nearly 2%, making it difficult for USD/JPY to gain traction.
The US Bureau of Labor Statistics will release the Producer Price Index (PPI) data for June. More importantly, FOMC Chairman Jerome Powell will start the two-day presentation of the US Federal Reserve's semiannual report to Congress.
Powell Preview: Three reasons to expect the Fed Chair to down the dollar.
Technical levels to watch for
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold: Middle East war fears spark fresh XAU/USD rally, will it sustain?
Gold price is trading close to $2,400 early Friday, reversing from a fresh five-day high reached at $2,418 earlier in the Asian session. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row.
Bitcoin Price Outlook: All eyes on BTC as CNN calls halving the ‘World Cup for Bitcoin’
Bitcoin price remains the focus of traders and investors ahead of the halving, which is an important event expected to kick off the next bull market. Amid conflicting forecasts from analysts, an international media site has lauded the halving and what it means for the industry.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.