Should We Keep an Eye on the Euro’s Upside Potential as It Strengthens Alongside the Japanese Yen?
04.08.2025
- Japan: Monetary Base
- U.S. Durable Goods Orders
In U.S. currency trading last weekend, the Canadian dollar weakened against the yen starting in Asian trading hours. The CAD/JPY pair fell from 108.958 to 106.806. It moved from above the 20-period moving average (MA) on the hourly chart to below it and plummeted along the -3σ line of the Bollinger Bands.On the 4-hour chart, the RSI has fallen from 67 to 32, and on the daily chart, the price has broken well below the 20-MA line, which had served as support until the latter half of last month. Since the pair opened with a downward gap during today’s Asian session, traders should watch for continued weakness in the Canadian dollar.
European currencies rose as the euro strengthened against the pound after the preliminary flash estimate of the EU’s July Harmonized Index of Consumer Prices (HICP), released on the 1st, remained unchanged at 2.3% year-over-year.The euro/pound pair rose from 0.8636 to 0.8728. It trended upward while finding support at the 20-period moving average (MA) on the hourly chart. On the 4-hour chart, the pair rebounded after finding support at the 200-period simple moving average (SMA), and on the daily chart, it has made a sharp recovery from a stagnant period below the 20-period MA to a level above it.
Today’s economic indicators include Japan’s monetary base at 8:50, Switzerland’s Consumer Price Index at 15:30, Switzerland’s Manufacturing PMI at 16:30, and U.S. Manufacturing New Orders and U.S. Durable Goods Orders (final figures) at 23:00.No other major economic indicators or key speeches are scheduled. We will carefully monitor the upside potential of the euro, which has been strengthening alongside the Japanese yen.
Author: Keisuke Sakurai
