Should we keep an eye on the upside for the U.S. dollar, which is facing weak upward pressure?
21.02.2022
- Remarks by Federal Reserve Governor Bowman
- European Manufacturing/Services PMI
Last weekend, U.S. currencies were affected by the escalating situation in Ukraine, causing cross-yen pairs to decline during U.S. trading hours. The USD/JPY pair fell from 115.30 to 114.87, offsetting its gains during Asian trading hours. While the U.S. dollar weakened, the British pound strengthened against the dollar. The GBP/USD pair rebounded from 1.357 to 1.362.We will be watching closely to see if GBP/USD continues to rise and reaches its recent high of 1.364.
Among European currencies, the euro has seen a notable decline. The EUR/JPY pair has shown the weakest resilience among the yen crosses, falling approximately 110 pips from 131.11 to 129.96. From a technical perspective, the EUR/JPY is showing price action that suggests it may be forming a head-and-shoulders pattern on the 4-hour chart. If it continues to fall, there is no significant support until 129.52, so traders should be wary of a sharp drop.
Today, the following releases are scheduled: the French Manufacturing/Services PMI at 17:15 CET, the German Manufacturing/Services PMI at 17:30 CET, the Eurozone Manufacturing/Services PMI at 18:00 CET, and the UK Manufacturing/Services PMI at 18:30 CET. Additionally, remarks by Federal Reserve Governor Bowman are scheduled for 25:15 CET, after the markets have shifted to U.S. trading hours.With the release of the U.S. Consumer Confidence Index scheduled for tomorrow, we will be watching closely to see if the U.S. dollar shows any clear direction.
Author: Keisuke Sakurai
