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USD/JPY Needs Close Below 101.50 to Favor Bearish Forecast

USD/JPY Needs Close Below 101.50 to Favor Bearish Forecast

2014-05-15 17:05:00
David Song, Currency Strategist
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Talking Points:

- Bearish USDOLLAR Outlook Favored on Close Below 10,470

- EUR/USD Holds Key1.3650-60 Support Even as 1Q GDP Disappoints

- USD/JPY Hits Fresh Monthly Low (101.30) But Needs Close Below 101.50

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) may resume the downward trend from earlier this year as it retains the opening range from the beginning of the month, and the greenback may weaken further over the remainder of the week on another failed attempt to close above the 10,470 pivot.

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10460.19

10487.07

10448.69

-0.02

122.37%

Given the limited market reaction to the better-than-expected U.S. data, it seems as though market participants are waiting for Fed Chair Janet Yellen as the central bank head is scheduled to speak later today, but there’s certainly limited scope of seeing a major shift in the policy outlook as the committee remains in no rush to normalize monetary policy.

With that said, the dollar may continue to carve lows highs & lower lows going into the second-half of 2014, and the reserve currency remains at risk of giving back the advance from back in October (10,354) as Ms. Yellen remains reluctant to move away from the zero-interest rate policy (ZIRP).

USD/JPY Needs Close Below 101.50 to Favor Bearish Forecast

Join DailyFX on Demandto Cover Current U.S. dollar Trade Setups

Read More:

US Dollar Forecast to Rally versus Euro, GBP, but Watch Yen and AUD

Sea Change in Central Bank Policy Leaves EUR/JPY, GBP/JPY Vulnerable

USDOLLAR Daily

USD/JPY Needs Close Below 101.50 to Favor Bearish Forecast

Chart - Created Using FXCM Marketscope 2.0

  • Failure to Close Above 10,470 to Highlight Lower High
  • Interim Resistance: 10,602 (38.2 retracement) to 10,615 (78.6 expansion)
  • Interim Support: 10,354 to 10,375 (50.0 retracement)

Release

GMT

Expected

Actual

Consumer Price Index (MoM) (APR)

12:30

0.3%

0.3%

Consumer Price Index (YoY) (APR)

12:30

2.0%

2.0%

Consumer Price Index ex Food and Energy (MoM) (APR)

12:30

0.1%

0.2%

Consumer Price Index ex Food and Energy (YoY) (APR)

12:30

1.7%

1.8%

Consumer Price Index n.s.a. (APR)

12:30

237.095

237.072

Consumer Price Index Core n.s.a. (APR)

12:30

236.914

237.163

Initial Jobless Claims (MAY 10)

12:30

320K

297K

Continuing Claims (MAY 3)

12:30

2690K

2667K

Empire Manufacturing (MAY)

12:30

6.00

19.01

Net Long-Term TIC Flows (MAR)

13:00

$40.0B

$4.0B

Total Net TIC Flows (MAR)

13:00

--

-$126.1B

Industrial Production (MoM) (APR)

13:15

0.0%

-0.6%

Capacity Utilization (APR)

13:15

79.1%

78.6%

Manufacturing Production (SIC) (APR)

13:15

0.3%

-0.4%

Philadelphia Fed Business Outlook (MAY)

14:00

14.0

15.4

Mortgage Delinquencies (1Q)

14:00

--

6.11%

MBA Mortgage Foreclosures (1Q)

14:00

--

2.65%

NAHB Housing Market Index (MAY)

14:00

49

45

Fed Chair Janet Yellen Speaks on U.S. Economy

22:10

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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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