USD/JPY struggles near multi-week low, below mid-141.00s amid weaker USD

USD/JPY languishes near a multi-week low amid the prevalent USD selling bias.
Bets that the Fed soon end its rate-hiking cycle keep the USD bulls on the defensive.
Bearish traders turn caution as the focus now shifts to the US CPI on Wednesday.

Haresh Menghani FXStreet

The USD/JPY pair is seen oscillating in a narrow trading band, just below mid-141.00s during the Asian session on Tuesday and consolidating its losses registered over the past three days to over a three-week low touched the previous day.

The US Dollar (USD) languishes near its lowest level since June 22 in the wake of speculations that the Federal Reserve (Fed) will soften its hawkish stance sooner rather than later and turns out to be a key factor acting as a headwind for the USD/JPY pair. In fact, two Fed officials said Monday that the end to the current monetary policy tightening cycle is getting close, which led to the overnight decline in the US Treasury bond yields and keeps the USD bulls on the defensive.

The Fed speakers, however, noted that the US central bank will likely need to raise interest rates further to bring down inflation. This, in turn, reaffirms market bets for a 25 bps lift-off at the upcoming FOMC policy meeting on July 25-26, which should act as a tailwind for the US bond yields and help limit deeper losses for the buck. Furthermore, expectations that the Bank of Japan (BoJ) will stick to its dovish stance might hold back bears from placing fresh bets around the USD/JPY pair.

Market participants seem convinced that BoJ's negative interest-rate policy will remain in place at least until next year. Adding to this, BoJ Deputy Governor Shinichi Uchida reportedly said last Friday that the central bank will maintain its yield curve control (YCC) policy from the perspective of sustaining ultra-loose monetary conditions. This warrants caution before positioning for an extension of the USD/JPY pair's recent pullback from the 145.00 mark, or the YTD peak touched last week.

Traders might also prefer to wait on the sidelines ahead of the release of the latest US consumer inflation figures on Wednesday, which will play a key role in influencing the Fed's near-term policy outlook and the USD price dynamics. In the meantime, the US bond yields might drive the USD demand and provide some impetus to the USD/JPY pair in the absence of any relevant market-moving economic releases from the US on Tuesday.

Technical levels to watch

USD/JPY

Overview
Today last price	141.29
Today Daily Change	-0.02
Today Daily Change %	-0.01
Today daily open	141.31

Trends
Daily SMA20	142.86
Daily SMA50	139.84
Daily SMA100	136.87
Daily SMA200	137.21

Levels
Previous Daily High	143
Previous Daily Low	141.28
Previous Weekly High	144.91
Previous Weekly Low	142.07
Previous Monthly High	145.07
Previous Monthly Low	138.43
Daily Fibonacci 38.2%	141.94
Daily Fibonacci 61.8%	142.35
Daily Pivot Point S1	140.72
Daily Pivot Point S2	140.14
Daily Pivot Point S3	139
Daily Pivot Point R1	142.45
Daily Pivot Point R2	143.59
Daily Pivot Point R3	144.18

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.