Should investors be wary of the direction of cross-yen pairs, which have reversed course from last weekend’s yen strength and are now weakening again?
29.03.2023
- France: Consumer Confidence Index
- U.S. Existing-Home Sales Pending
In U.S. currency trading the previous day, the U.S. dollar fell slightly against the yen after the Conference Board’s U.S. Consumer Confidence Index for March, released yesterday, rose to 104.2 from 102.9 the previous month. The USD/JPY pair fell from 131.567 to 130.391.The decline halted after the pair touched the -2σ level on the daily chart. During today’s Asian session, the pair has rebounded, rising to 131.850. As today’s rebound has formed a pattern of higher lows on the 4-hour chart, we will be closely monitoring the U.S. dollar’s performance during U.S. trading hours.
Among European currencies, the pound saw a seesaw movement against the yen. GBP/JPY fluctuated between 160.727 and 161.781 before breaking above that level during today’s Asian trading session.It has now risen to 162.456, breaking through the 200-period SMA on the 4-hour chart. We need to carefully assess whether the pound’s momentum will continue heading into European trading hours.
Today, at 3:00 p.m., the German GfK Consumer Confidence Survey; at 3:45 p.m., the French Consumer Confidence Index; and at 5:30 p.m., the UKMortgage Approvals, at 20:00 the U.S. MBA Mortgage Applications Index, at 21:30 remarks by U.S. Federal Reserve Vice Chair Barr, at 23:00 U.S. Pending Home Sales and remarks by U.S. Federal Reserve Vice Chair Barr, at 23:30 U.S. Weekly Crude Oil Inventories,at 25:30: Remarks by BOC Deputy Governor Gravel (Canada); at 26:00: U.S. 7-Year Treasury Auction; at 27:50: Remarks by MPC Member Mann (UK); and at 6:45 the following day: New Zealand Housing Construction Permits.We should remain cautious about the direction of cross-yen pairs, which have reversed course from last weekend’s yen strength and are now returning to yen weakness.
Author: Keisuke Sakurai
