USD/JPY to slide towards the July low at 104.20

FXStreet Team FXStreet

The American dollar is under strong selling pressure ahead of US events, with USD/JPY trading near the 105.00 level. The pair is technically bearish and could accelerate the slump towards 104.20, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“The focus is today on US Retail Sales and the US Federal Reserve monetary policy decision. Sales are foreseen up 1% in August, while the Control Group sub-component is expected at 0.5%, down from 1.4% in the previous month. As for the Fed, the central bank will likely refrain from making changes to its monetary policy, after announcing a new policy framework, which targets average inflation. Investors may be eyeing from an explanation on what inflation ‘moderately above’ 2% means for policymakers. Would they let it run to 2.5% or 3.0%? This is the big question surrounding Powell & Co. today, although it seems unlikely they will provide a clear answer.”

“The USD/JPY pair is oversold in the short-term but still bearish. The 4-hour chart shows that it is currently developing far below a sharply bearish 20 SMA, which extends its decline below the larger ones. Technical indicators, in the meantime, have stabilized in oversold levels, with no signs of changing course. Further declines are to be expected on a break below 105.10, with the pair then targeting 104.18, July’s monthly low.”

Author

FXStreet Team

FXStreet

EUR/USD onsolidates around mid-1.1800s as traders keenly await FOMC Minutes

The EUR/USD pair struggles to capitalize on the previous day's goodish rebound from the 1.1800 neighborhood, or a one-and-a-half-week low, and consolidates in a narrow band during the Asian session on Wednesday. Spot prices currently trade just below mid-1.1800s, nearly unchanged for the day.

GBP/USD seems vulnerable near mid-1.3500s; UK CPI/FOMC Minutes awaited

The GBP/USD pair struggles to capitalize on the previous day's late rebound from an over one-week low – levels below the 1.3500 psychological mark – and trades with a negative bias for the third consecutive day on Wednesday. The downside, however, remains cushioned as investors seem reluctant to place aggressive directional bets ahead of the release of the latest UK consumer inflation figures and FOMC Minutes.

Gold regains positive traction after Tuesday's over 2% slump as traders await FOMC Minutes

Gold gains some positive traction during the Asian session on Wednesday and recovers a part of the previous day's heavy losses more than 2%, to the $4,843-4,842 region or a nearly two-week low. The intraday move higher could be attributed to repositioning trade ahead of the release of the FOMC Minutes.

Top Crypto Gainers: Jito drops, Morpho holds steady, Convex Finance climbs

Decentralized Finance tokens, including Jito, Morpho, and Convex Finance, rank among the top-performing crypto assets over the last 24 hours. Jito dips on Wednesday after rallying 22% the previous day on the launch of a new mainnet node.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.