Investors should keep an eye on currency strength trends, which appear to be shifting from yen appreciation at the end of the month to yen depreciation

Investors should keep an eye on currency strength trends, which appear to be shifting from yen appreciation at the end of the month to yen depreciation

01.12.2023

In yesterday’s U.S. trading session, the Canadian dollar rose against the yen ahead of today’s U.S. employment report. The CAD/JPY pair rebounded by approximately 130 pips, rising from 108.061 to 109.451. On the hourly chart, the price broke above the 200-period SMA resistance with a bullish candle.Technically, the CAD/JPY pair is trading in a range as it searches for direction around the daily 20-day moving average, and the daily RSI is also stagnating around the 50 level. It will be worth watching whether the Canadian dollar continues its rebound against the yen into early December.

European currencies saw the Swiss franc rise against the yen after yesterday’s release of Swiss October retail sales data showed an improvement from the previous month’s -0.6% to -0.1%. The CHF/JPY pair rose from 168.032 to 170.208. On the 4-hour Bollinger Bands chart, the price temporarily broke above the +3σ line.On the daily chart, while the price remains within the +2σ range of the Bollinger Bands, the lows are rising, so caution is warranted regarding the potential for an upward move at the start of the month.

Today’s schedule includes India’s Manufacturing PMI at 14:00, Turkey’s Manufacturing PMI at 16:00, France’s Budget Balance at 16:45, Switzerland’s Real GDP at 17:00, Switzerland’s SVME Purchasing Managers’ Index at 17:30, Germany’s Manufacturing PMI at 17:50, the Eurozone Manufacturing PMI at 18:00, and the UK’sManufacturing PMI, 10:30 PM: Canada Employment Report, 11:45 PM: US Manufacturing PMI, 12:00 AM: US Construction Spending, US ISM Manufacturing PMI, US Goolsbee (Chicago Fed President) remarks, and 1:00 AM: US Fed Chair Powell remarks.We need to carefully assess the shift in currency strength, which is moving from yen appreciation at the end of the month to yen depreciation.