Talking Points:
- USD/JPY Continues to Carve Higher-Lows Despite Hamada Comments.
- AUD/USD Holds Key Support Ahead of China 1Q GDP Report.
- USDOLLAR Risks Further Losses as Bearish RSI Divergence Takes Shape.
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Chart - Created Using FXCM Marketscope 2.0
- Even though Koichi Hamada, an adviser to Prime Minister Shinzo Abe,argues that ‘selling of the yen is coming closer to its limit,’ may continue to see range-bound prices in USD/JPY as it retains the monthly-opening range.
- Beyond the bearish momentum in the Relative Strength Index (RSI), the Bank of Japan’s (BoJ) April 30 meeting may further undermine the bullish outlook for USD/JPY should Governor Haruhiko Kuroda continue to endorse a neutral tone for monetary policy.
- DailyFX Speculative Sentiment Index (SSI) shows the retail FX crowd remains net-long USD/JPY, but seeing narrowing participation as open interest slips 0.2% from the previous day, with the ratio climbing to +2.50 amid a 13.2% decline in short positions.
AUD/USD
- Ongoing closes above 0.7570 (50% expansion) to 0.7590 (100% expansion) may encourage a larger rebound in AUD/USD especially as the bullish RSI momentum gathers pace.
- However, as China – Australia’s largest trading partner – is expected to grow at a slower pace in 2015, a dismal 1Q Gross Domestic Product (GDP) report may heighten speculation for another rate cut from the Reserve Bank of Australia (RBA) as Governor Glenn Stevens retains a dovish outlook for monetary policy.
- Need a break/close above former-support zone around 0.7720 (161.8% expansion) to 0.7740 (78.6% expansion) to favor a larger rebound in the aussie-dollar.
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Read More:
Price & Time: USD/JPY Dead Money?
COT-Euro Positioning Little Changed from Record
USDOLLAR(Ticker: USDollar):
| Index | Last | High | Low | Daily Change (%) | Daily Range (% of ATR) |
|---|---|---|---|---|---|
| DJ-FXCM Dollar Index | 12069.99 | 12142.96 | 12051.22 | -0.45 | 124.10% |
Chart - Created Using FXCM Marketscope 2.0
- Dow Jones-FXCM U.S. Dollar risks a larger decline as the bearish RSI momentum takes shape; long-term outlook remains bullish as the upward trending channel from July 2014.
- In light of the ongoing weakness in private-sector consumption, will continue to watch the slew of central bank rhetoric as 2015 voting-members Jeffrey Lacker, Dennis Lockhart and Stanley Fischer are scheduled to speak this week.
- Despite the risk for a double-top formation, will continue to watch the string over lower-highs in the USDOLLAR, with interim support coming in around 11,997 (100% expansion) to 12,017 (50% expansion).Join DailyFX on Demand for Real-Time SSI Updates!
| Release | GMT | Expected | Actual |
|---|---|---|---|
| Advance Retail Sales (MoM) (MAR) | 12:30 | 1.1% | 0.9% |
| Advance Retail Sales ex Auto (MoM) (MAR) | 12:30 | 0.7% | 0.4% |
| Advance Retail Sales ex Auto & Gas (MoM) (MAR) | 12:30 | 0.6% | 0.5% |
| Advance Retail Sales Control Group (MAR) | 12:30 | 0.5% | 0.3% |
| Producer Price Index (MoM) (MAR) | 12:30 | 0.2% | 0.2% |
| Producer Price Index (YoY (MAR) | 12:30 | -0.9% | -0.8% |
| Producer Price Index ex Food & Energy (MoM) (MAR) | 12:30 | 0.1% | 0.2% |
| Producer Price Index ex Food & Energy (YoY) (MAR) | 12:30 | 0.9% | 0.9% |
| Producer Price Index ex Food, Energy, Trade (MoM) (MAR) | 12:30 | 0.1% | 0.2% |
| Producer Price Index ex Food, Energy, Trade (YoY) (MAR) | 12:30 | 0.8% | 0.8% |
| NFIB Small Business Optimism (MAR) | 13:00 | 98.0 | 95.2 |
| Business Inventories (FEB) | 14:00 | 0.2% | 0.3% |
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--- Written by David Song, Currency Analyst
To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.
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