Should we keep an eye on the upside potential for the euro-yen pair, which has reached levels not seen since the Lehman Shock?
23.06.2023
- UK Retail Sales
- European Manufacturing/Services PMI
In the U.S. currency market yesterday, the U.S. dollar rose against the yen after the U.S. May existing home sales figure, released yesterday, came in at 4.3 million units, exceeding the market forecast of 4.2 million.The USD/JPY pair rose by just under 170 pips, from 141.162 to 143.238. Combined with hawkish comments from Fed Chair Powell—following those made the day before yesterday—the pair hit a new high for the year. During today’s Asian trading session, the USD/JPY pair has touched 143.407. We will closely monitor the market to see if this upward trend continues.
European currencies rose against the yen as the Eurozone’s June consumer confidence index, released yesterday, improved to -16.1 from the previous reading of -17.4.The EUR/JPY pair rose by approximately 130 pips from 155.595 to 156.930, reaching levels not seen since September 2008. While the RSI on the 4-hour chart has exceeded 70 and divergence is evident, the RSI on the weekly chart has not yet reached the recent high of 78, leaving some room for growth. Therefore, it remains to be seen whether the upward momentum will continue during U.S. trading hours.
Today’s schedule includes UK retail sales at 3:00 PM, Turkey’s trade balance and economic confidence at 4:00 PM, remarks by ECB President Lagarde at 4:00 PM, France’s manufacturing and services PMI at 4:15 PM, Germany’s manufacturing and services PMI at 4:30 PM, the Eurozone’s manufacturing and services PMI at 5:00 PM, and the UK’smanufacturing/services PMI at 5:00 PM, remarks by U.S. St. Louis Fed President Bullard at 6:15 PM, U.S. manufacturing/services PMI at 10:45 PM, and remarks by U.S. Cleveland Fed President Mester at 2:40 AM. We will be watching for upside potential in the EUR/JPY pair, which has reached levels not seen since the Lehman Shock.
Author: Keisuke Sakurai
