USD/JPY is trading in Tokyo neutral and sideways having made a fresh high of 110.80, but retreating back to 110.70 from a low of 110.63.
- Global market wrap: ongoing solid momentum into H2 – ANZ
- German coalition fracturing over immigration issues, Seehofer seeking to resign – AFP
In an environment of dollar weakness on the last trading day for June, the yen was also under pressure while Wall Street rallied early doors and Chinese markets were improving. At the same time, an EU immigration plan was sending positive flows into EUR/JPY, all of which weighed on the yen.
- EUR/JPY: eyes on global equities, European politics and key data/geo-political events
USD/JPY was trading and closing above 110.50/60 and made a high of 110.94, although closing at 110.67 and around the 21-hr SMA while US Q2 GDP forecasts were trimmed on softer spending in May which ultimately was weighing on US treasury yields and capped Friday’s advance beyond 2.87% in the 10-year yields, with the greenback otherwise supported by PCE and June Chi PMI.
For the week ahead, however, there are plenty of key risk events, including nonfarm payrolls at the end of the week. Indeed, there will also be much attention paid to the 6th July when trade tariffs are kicking, imposed by the Trump administration on China.
- The load down on Trump, the market will remain stuck with the guy – Nordea
USD/JPY levels
Valeria Bednarik, chief analyst at FXStreet explained that the technical readings in the daily chart favouring another leg higher ahead, although argued that the upward strength remains limited:
“Nevertheless, the pair managed to recover after struggling at the beginning of the week with its 200 DMA, while technical indicators maintain upward slopes above their midlines, the RSI actually at 2-week highs. Shorter term, and according to the 4 hours chart, the pair is at risk of correcting lower, as it holds above its 100 and 200 SMA, but technical indicators have retreated sharply from near overbought levels, any way holding well above their midlines.”
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