Should investors be wary of a pre-FOMC correction?

Should investors be wary of a pre-FOMC correction?

21.07.2022

In the previous day’s U.S. currency trading, the dollar index had fallen to the low 106s, causing the USD/JPY pair to trade in a range of approximately 60 pips between 137.906 and 138.458.During today’s Asian session, the Bank of Japan announced its policy rate, and the pair has been fluctuating within a range similar to yesterday’s. On the daily chart, a divergence is visible where the candlesticks and the RSI are moving in opposite directions, so we should be wary of a corrective decline ahead of the FOMC meeting.

European currencies are trading nervously ahead of today’s ECB policy rate announcement, with the euro/dollar pair falling by approximately 110 pips from 1.0270 to 1.0156. However, it has regained momentum during today’s Asian session and has broken above the 20-period moving average on the hourly chart. While it remains above the 75-period moving average on the 4-hour chart, we will be watching closely to see if the upward trend continues.

Today’s key events include remarks by UK MPC member Pill at 5:00 PM, the Turkish CBRT’s policy rate decision and statement at 8:00 PM, and at 9:15 PM, theECB policy rate and statement at 9:15 PM, U.S. initial jobless claims and the Philadelphia Fed Manufacturing Index at 9:30 PM, ECB President Lagarde’s press conference at 9:45 PM, the U.S. Leading Economic Index at 11:00 PM, and U.S. weekly natural gas inventories at 11:30 PM. We need to remain vigilant to see if conditions will arise for the Japanese yen to come under selling pressure again.

Past Market Reports

1. 22.04.2026New

   Will interest grow in the upside potential of the Swiss franc, which has risen against the yen?

2. 21.04.2026New

   With the euro-Australian dollar pair hitting new lows this month, attention is turning to how much further it might fall

3. 20.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

4. 17.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

5. 16.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

6. 15.04.2026

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

7. 14.04.2026

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

8. 13.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

9. 10.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

10. 09.04.2026

    Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?