|Day's range||131.405 - 131.94|
|52-week range||125.080 - 137.229|
the ECB will be releasing its monetary policy meeting minutes. The minutes cover the June ECB meeting where policymakers announced a taper to the QE program and an exit from QE by December 2018.
Overall, it was a “cheerleading” speech with Draghi emphasizing the accomplishments of the ECB and the importance of the European Union unifying against the threat of increased protectionism in order to promote economic prosperity.
The USDJPY is coiling for a significant break and the technical analysis points to higher levels. In this case, the vertical movement is the strong bullish reaction the pair had when President Trump got elected one and a half years ago. Typically, the USDJPY is correlated directly to the United States equity.
The European Central Bank president, Mario Draghi was speaking at the banking conference event in Portugal last week. The main take away from the speech was that the ECB president promised that the ECB would take time to hike interest rates.
The breakaway gap in the Euro (in this article, we use “Euro” to refer to the currency pair EUR/USD) on the 24th of April 2017 on the back of positive first round French election results that weekend broke through a resistance trendline from 2014, a 5-month ascending triangle and the 200-day moving average. It heralded a reversal in the trend of the Euro and what followed was a near 1-year rally that took the price from 1.087 to a high of 1.2558, a rise of 15.5%. After consolidating in a symmetrical triangle, the Euro broke to the downside and has been falling for over a month now.
Market Focus, Key findingsECB’s Weidmann says first ECB Rate Hike could follow the end of Quantitative Easing more closely than in the USAIndustrial Producer Prices rose by 0.1% in the EURO AREA (EA19) and by 0.2% in the EU28European Commission forecasts EURO ZONE inflation will accelerate to 1.6 pct YoY in 2019 from 1.5 pct YoY seen in 2018
The euro turned positive on Tuesday following reports that the European Central Bank would use its next policy meeting to discuss an exit from its quantitative easing program. Expectations for the ECB to normalize its monetary policy had waned in recent months as European economic data was sluggish and political developments in Italy took center stage. Market participants questioned whether the ECB could afford to halt bond buys if the economic recovery was slowing and Italy's government was euroskeptic.
Eurozone inflation that’s creeping up toward the European Central Bank’s target and Italy’s political crisis could pull policy makers in opposite directions, and the struggle could spell further weakness for the euro. Core inflation stood at 1.1%, higher than the 1% number expected.
Though there still remains a significant amount of uncertainty, recent populist movements in Italy have created the possibility of ending the national use of the Euro. Naturally, as a nation of over 60 million and the third largest nation in the Eurozone (after Germany and France), Italy’s abandonment of the Euro could spark a wide variety of far-reaching changes.
The start of the week’s trading took place around excitement in the political situation in Italy and the unsuccessful attempts of Crude Oil to rebound.
Early Monday trading has seen the downward pressure continue for oil prices. Italian stocks rise on prospects of new elections, and Italian bonds strengthen as the populist coalition fails to form a government.
Traditional haven currencies, such as Japan’s yen and, to a lesser extent, the Swiss franc, were on the rise on Wednesday as trade and geopolitical concerns came back into focus and the selloff in high-yielding emerging markets assets intensified. President Donald Trump on Tuesday said he wasn’t happy with how trade talks between the U.S. and China were progressing, and said the much anticipated U.S.-North Korea summit planned for next month in Singapore might not go ahead as planned, which sent ripples through global financial markets. The Swiss franc, which is also considered a haven currency though its moves tend to be more muted, rose 0.5% against the (EURCHF).
The British pound climbed against the dollar Thursday after a report the U.K. government plans to stay in the customs union beyond 2021, while the greenback slightly ease against major rivals but still hovered at highs for 2018. The ICE U.S. Dollar Index (IFUS:DX-Y.NYB) was down 0.2% at 93.191, holding around its highest levels of the year, but off Wednesday’s print of 93.391. A broader measure of the greenback, tracking 16 rival monetary units, the WSJ Dollar Index (CALCULATED:BUXX) slipped 0.2% to 86.73.
The Yen has continued to traverse its weaker trend versus the U.S Dollar and has broken resistance consistently in the short term.
The Ecofin meetings are a major event in the EU, with leaders from all member states attending each time that they are held. How could the meeting affect the euro?
The EUR/JPY has been following both the ascending trend line and the EMA perfectly and we might see the uptrend continuation. POC zone 131.50-60 could reject the pair on retracement. However if we don’t see any retracement pay attention to 131.75 rejection towards 132.00. Only above 132.00 we might see 132.40 that is D H5 – strong daily resistance. As long as the pair is kept above 131.25, bulls should be safe.
With a week-long descending trend-line aptly restricting the USDJPY’s latest recovery, the pair seems well inclined to re-test an upward slanting TL support, at 105.75 now, breaking which it can decline to 105.25 and then to the 105.00 round-figure. Though, 104.60 could restrict the quote’s additional downside, failing to which can highlight 61.8% FE level of 104.10. On the upside, aforementioned trend-line number of 106.70 may keep disappointing the short-term buyers, which if broken could escalate the pair’s moves towards 107.20 and 107.65 while 107. ...
The Euro has been losing value in forex for nearly a week. While the European currency is testing important support and looks vulnerable.
The Yen has effectively gotten stronger in the mid-term. Risk adverse trading in Asia has helped the Yen break through important support.