Yen's Mild Recovery Overshadowed by Risk-On Sentiment; Euro, Swiss Franc Trail Closely in Underperformance
| Action Insight Daily Report 5-19-23 |
Yen's Mild Recovery Overshadowed by Risk-On Sentiment; Euro, Swiss Franc Trail Closely in Underperformance |
Japanese yen made a modest recovery today, bolstered by yet another month of robust consumer inflation data. However, this uptick in the currency was held back by strong risk-on sentiment prevalent in Japan, with Nikkei surging to a 33-year high. BoJ's continued commitment to its ultra-loose monetary policy also put a damper on Yen's rise, securing its position as the weakest performer for the week - and by a significant margin at that. With the week drawing to a close, Euro and Swiss franc are trailing closely behind the Yen as underperformers, followed by Sterling. New Zealand Dollar stands as the week's strongest, receiving a slight boost from promising trade data released today. Canadian dollar, buoyed by earlier in the week's CPI data, anticipates the next move from retail sales figures due later today. Dollar maintains a firm stance, albeit lagging behind Kiwi and Loonie. From a technical standpoint, EUR/CAD pair has seen its fall from 1.5111 intensify this week. Given bearish divergence in D MACD, the decline could be viewed as a correction to the overall uptrend from 1.2867. As long as 1.4746 resistance level holds, deeper fall towards 1.4236 cluster support (38.2% retracement of 1.2867 to 1.5111 at 1.4254) is expected. Notably, strong support could emerge here to trigger a rebound, at least on the initial attempt. In Asia, Nikkei rose 0.77% to 30808.35. Japan 10-year JGB yield rose 0.0177 to 0.403. Hong Kong HSI is currently down -1.28%. China Shanghai SSE is down -0.47%. Singapore Strait Times is up 0.55%. Overnight, DOW rose 0.34%. S&P 500 rose 0.94%. NASDAQ rose 1.51%. 10-year yield rose 0.067 to 3.648. |
USD/JPY Daily Outlook Daily Pivots: (S1) 137.75; (P) 138.25; (R1) 139.21; More... Intraday bias in USD/JPY remains on the upside for now, despite current slight retreat. Current rise is part of the whole rally from 127.20. Next target is 100% projection of 127.20 to 137.90 from 129.62 at 140.32. Break there will target 142.48 fibonacci level. On the downside, below 137.27 minor support will turn intraday bias neutral first. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 22:45 | NZD | Trade Balance (NZD) Apr | 427M | -1310M | -1273M | -1586M | | 23:01 | GBP | GfK Consumer Confidence May | -27 | -30 | | 23:30 | JPY | National CPI Y/Y Apr | 3.50% | 3.20% | | 23:30 | JPY | National CPI Core Y/Y Apr | 3.40% | 3.40% | 3.10% | | 23:30 | JPY | National CPI Core-core Y/Y Apr | 4.10% | 3.80% | | 04:30 | JPY | Tertiary Industry Index M/M Mar | -1.70% | -0.10% | 0.70% | 1.70% | | 06:00 | EUR | Germany PPI M/M Apr | 0.30% | -0.50% | -2.60% | -1.40% | | 06:00 | EUR | Germany PPI Y/Y Apr | 4.10% | 4.00% | 7.50% | 6.70% | | 08:00 | EUR | ECB Economic Bulletin | | 12:30 | CAD | Retail Sales M/M Mar | -1.30% | -0.20% | | 12:30 | CAD | Retail Sales ex Autos M/M Mar | -0.80% | -0.70% |
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