Should We Be Wary of a Further Drop in the CAD/JPY Pair Following the Decline in Canadian CPI?
21.08.2024
- UK Public Sector Net Debt
- U.S. MBA Mortgage Applications Index
In U.S. currency trading yesterday, the Canadian dollar fell against the yen after Canada’s July Consumer Price Index, released yesterday, showed a year-over-year increase of 2.5%, down 0.2 percentage points from the previous month’s 2.7%. The CAD/JPY pair fell by approximately 160 pips, from 108.050 to 106.454.The pair touched the -3σ line on the hourly Bollinger Bands. On the 4-hour chart, the 75-period moving average (MA) is acting as resistance, so traders should watch for a continued decline during U.S. trading hours.
Despite the fact that Germany’s July Producer Price Index, released yesterday, improved year-over-year from the previous month’s -1.6% to -0.8%, the euro fell against the yen.The euro/yen pair fell from 163.194 to 161.357, breaking below the support line formed by the 200-period simple moving average (SMA) on the hourly chart. On the 4-hour chart, the price has shifted from above the 20-period moving average (MA) to below it. Since the 20-period MA is acting as a resistance level on the daily chart, traders should be wary of further declines during European trading hours.
Today’s economic indicators include Japan’s trade balance (customs-based) at 8:50, Australia’s Westpac Leading Economic Index at 9:30, the UK’s net public sector debt at 15:00,at 16:00, Thailand’s central bank policy rate; at 17:00, South Africa’s Consumer Price Index; at 20:00, the U.S. MBA Mortgage Applications Index; at 21:30, Canada’s Industrial Product Prices and Raw Materials Price Index; at 23:30, U.S. weekly crude oil inventories;26:00: U.S. 20-Year Treasury Auction, and 27:00: Release of the U.S. FOMC Minutes. Be cautious of further declines in the CAD/JPY pair, which fell following the drop in Canada’s CPI.
Author: Keisuke Sakurai
