Will BOJ expectations threaten USD/JPY’s uptrend?
I’m looking at the pair’s 15-minute chart for clues.
Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Australian and New Zealand markets out on Anzac Day holiday
Property website Rightmove: Average asking prices for properties up by 0.2% m/m in April, less than the 1.2% gain seen at this time of year.
Days ahead of BOJ’s April policy announcement, Gov. Ueda says BOJ’s half year, one year, and one-and-a-half year inflation forecasts “must be quite strong and close to 2%” before considering YCC changes.
OPEC’s share of India’s oil imports fell from 72% to 59% in the fiscal year to March 2023, marking the fastest pace of decline and the lowest share in 22 years.
Oil benchmark prices slid on uncertainty over rising interest rates, global economic growth, and demand outlook.
Price Action News
Overlay of JPY Pairs 15-min
Cautiousness became the name of the game during the Asian session as traders priced in their growth concerns amidst a high interest rate environment for the major economies.
The safe-haven yen failed to cash in on the risk aversion though. One possible reason is Bank of Japan (BOJ) Governor Ueda basically shrugging off hawkish changes to the central bank’s Yield Curve Control (YCC) policies ahead of BOJ’s policy decision later this week.
JPY traded slightly lower than its Friday’s lows before seeing some buying ahead of the London session.
Germany’s IfO business climate at 8:00 am GMT
Canada’s new housing price index at 12:30 pm GMT
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USD/JPY 15-minute Forex Chart
A bit of yen weakness has pushed USD/JPY higher from its 134.00 Pivot Point earlier today, but it looks like the pair encountered some selling just under the 134.50 R1 mark of the Standard Pivot Points.
Let’s see if the USD-selling and JPY-buying get enough momentum to drag USD/JPY to its April trend line support.
Hawkish BOJ expectations could drag USD/JPY to the 133.60 area that lines up with today’s S1 and half of USD/JPY’s daily average volatility.
But if more traders zero in on the Fed’s May rate hike, then USD/JPY could find buyers without revisiting its trend line support.
Look out for a clear breakout above the 134.50 R1 area before eyeing potential short-term targets near 135.00.
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