USD/JPY Rebounds Ahead of US CPI Inflation
USD/JPY - H1
The pair is sensitive to the US Bond Yields movements and today's rise in the 10-Year one, fuels its recovery, along with broader cautious sentiment that seems to also benefit the US Dollar more.
As such, the reserve currency tries to return above its EMA100 (black line) and a successful effort, will open the door towards fresh weekly highs (113.67), bringing the downward trend line form October back into the spotlight (114.25-30).
In our last analysis, we had written that a daily close below 113.20 would pause the broader uptrend - something that occurred yesterday. Given this, and as long as it stays below EMA100, the pair is susceptible to fresh month lows (112.71), but a catalyst would be needed to carry the move below 112.23-40.
In any case, the next leg is unlike to be determined by technical factors, but rather by the looming US CPI Inflation at 13:30 GMT. Conventional wisdom suggests that higher than expected prints would increase rate hike expectations, boost US Bond Yields and strengthen the US Dollar.
Past Performance: Past Performance is not an indicator of future results.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.