News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • Are you new to trading? Technical analysis of charts aims to identify patterns and market trends by utilising different forms of technical chart types and other chart functions. Get a refresher on technical analysis or begin building your knowledge here: https://t.co/qV3c7a4YR3 https://t.co/2Qka1WPhnE
  • Entry orders are a valuable tool in forex trading. Traders can strategize to come up with a great trading plan, but if they can’t execute that plan effectively, all their hard work might as well be thrown out. Learn how to place entry orders here: https://t.co/1mnOXUuBpt https://t.co/kloJCFmJty
  • The continuity seen across these volatility cycles is a good thing. Historical precedence offer a blueprint for identifying conditions supportive for a vol-event to occur, and how they may unfold. Deepen your knowledge of historical volatility here: https://t.co/vg7w10la3j https://t.co/wwxKQFibW6
  • *Reminder: Weekly Strategy Webinar tomorrow morning at 8:30am EST on DailyFX! A look at the levels heading into #FOMC - https://t.co/lxd5fZnn4H
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here: https://t.co/8A1QhwMVKo https://t.co/Nx6AHxZksK
  • Markets Week Ahead: Euro, Dollar, Gold, S&P 500, Earnings, Inflation Check out @RichDvorakFX's latest market recap and preview plus all the weekly forecasts from the @DailyFXTeam at the link below! Link to Analysis - https://www.dailyfx.com/forex/fundamental/forecast/weekly/title/2021/07/25/markets-week-ahead-euro-dollar-gold-sp500-fed-earnings-inflation.html $EURUSD $SPX #Trading
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/rfwUWJfbz9 https://t.co/xKkBwu951j
  • The non-farm payroll (NFP) figure is a key economic indicator for the United States economy. It is also referred to as the monthly market mover. Find out why it has been given this nickname here: https://t.co/yOUVEEqhc5 https://t.co/MYWlQphqtb
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/paOy1oQmn3
  • US indices have a packed week ahead with earnings from the major technology names, US GDP data due and an FOMC rate decision. With so much on the docket the potential for volatility is heightened. Get your stock market forecast from @PeterHanksFX here: https://t.co/CH4WoStHvu
USDOLLAR Searching for Support- JPY to Face BoJ Rhetoric

USDOLLAR Searching for Support- JPY to Face BoJ Rhetoric

David Song, Strategist

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10783.36

10824.3

10771.4

-0.01

74.34%

Forex_USDOLLAR_Searching_for_Support-_JPY_to_Face_BoJ_Rhetoric_body_ScreenShot279.png, USDOLLAR Searching for Support- JPY to Face BoJ Rhetoric

Chart - Created Using FXCM Marketscope 2.0

Even though the Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) remains 0.01 percent lower from the open, we’re seeing the greenback continue to consolidate above the 10,760 figure, and the reserve currency may track higher ahead of the holiday trade as demands for U.S. Durable Goods increased 3.3 percent in April amid forecasts for a 1.5 percent print. Nevertheless, the dollar may face choppy price action throughout the North American trade as market participation thins ahead of Memorial Day, but should see the near-term correction in the reserve currency gather pace in the days ahead as it fails to maintain the bullish trend from earlier this month. Although, the shift in the Fed’s policy outlook should limit the downside for the dollar, and we will look for a higher low in the index as we anticipate the bullish sentiment surrounding the USD to get carried into the second-half of the year.

Forex_USDOLLAR_Searching_for_Support-_JPY_to_Face_BoJ_Rhetoric_body_ScreenShot280.png, USDOLLAR Searching for Support- JPY to Face BoJ Rhetoric

Indeed, the pullback in the relative strength index foreshadows a larger correction in the USDOLLAR, and we may see the 10,760 region fail to hold up as interim support as the oscillator continues to come off of overbought territory. Should we see a break to the downside, the dollar may work its way back towards former resistance around the 10,600 handle, and we will look to buy dips in the greenback as the exit strategy becomes a growing discussion at the Fed. In turn, the shift in the policy outlook should continue to influence the USD in the second-half of the year and we may see the FOMC move away from its easing cycle later this year as the outlook for growth improves.

Forex_USDOLLAR_Searching_for_Support-_JPY_to_Face_BoJ_Rhetoric_body_ScreenShot281.png, USDOLLAR Searching for Support- JPY to Face BoJ Rhetoric

Two of the four components rallied against the greenback, led by a 1.11 percent advance in the Japanese Yen, but we will look to buy dips in the USDJPY as it maintains the bullish trend from earlier this year. As we have a slew of Bank of Japan (BoJ) officials scheduled to speak next week, the fresh batch of central bank rhetoric may limit the downside for the USDJPY as Governor Haruhiko Kuroda retains a highly dovish tone for monetary policy. However, it seems as though the BoJ will stick to the sidelines for the time being as they assess the impact of the highly accommodative policy stance, and the dollar-yen may continue to consolidate within the upward trending channel from the beginning of the year as market participants weigh the outlook for monetary policy. Nevertheless, the deviation in the policy outlook should continue to produce fresh highs in the USDJPY, and we will look for a higher low in the exchange rate as we anticipate the BoJ to further embark on its easing cycle in the coming months.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Bring the economic calendar to your charts with the DailyFX News App.

New to FX? Watch this Video

Join us to discuss the outlook for the major currencies on the DailyFXForums

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES