USDOLLAR pulls back on Ueda comments and PBoC Fix


Weekly USDOLLAR Chart

The USDOLLAR weekly chart remains in uptrend. It has charted a higher trough (HT) followed by a higher peak (HP), which defines the uptrend. Moreover, it is above its black 30-week EMA, with the EMA turned up, and its weekly RSI is comfortably on the bullish side of 50 (blue rectangle).

This bullishness is not surprising given that the US 10-year real rate remains elevated at 1.96% and is greenback supportive.

BoJ and PBoC contribute to USDOLLAR's Monday Pullback

Nevertheless, the USDOLLAR strength has been dented and has started the week with a pullback.

Over the weekend, in an interview with the Yomiuri newspaper, Bank of Japan Governor Ueda expressed that the BoJ might possess sufficient data by the end of the year to decide regarding the possibility of ending negative interest rates.

Market reaction has been strong with USDOLLAR declining today as benchmark JGBs hit 0.7%.

In addition, in China, the PBoC provided a stronger CNY fixing and said that market participants should "maintain a stable market", avoiding speculative trades. This helped contribute to USDOLLAR weakness.

This Week's Data Points May Be USDOLLAR Supportive

Given the USDOLLAR's uptrend, the greenback pullback may be temporary. We will also get significant US data this week that has previously been dollar supportive.

The foremost data point will be the CPI release on Wednesday, which is forecast to show a rebound in inflation. Other data include the NFIB survey, retail sales and industrial production numbers later in the week.

Russell Shor

Senior Market Specialist

Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.

${} / ${getInstrumentData.ticker} /

Exchange: ${}

${} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}

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.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.