On Tuesday’s trading (15/8), the USDIndex rose +0.02%, recovering from early losses. Tuesday’s US economic news was mixed for the Dollar. On the positive side, July retail sales rose +0.7% m/m, stronger than expectations of +0.4% m/m. Also, the July import price index excluding petroleum was unchanged m/m, stronger than expectations of -0.2% m/m. On the negative side, the August empire manufacturing survey of general business conditions fell -20.1 to -19.0, weaker than the expectation of -1.0. Also, the August NAHB housing market index fell -6 to 50, weaker than the expectation of no change at 56. In addition, Tuesday’s stock market decline increased the demand for Dollar liquidity.
Meanwhile, the Yen still edged +0.03% weaker against the USD. Higher T-note yields on Tuesday weighed on the Yen. The Yen on Tuesday initially moved higher on economic news that showed Japan’s Q2 GDP grew more than expected and Japanese industrial production in June rose more than expected. Short-covering in the Yen came after comments from Japanese Finance Minister Suzuki supported speculation that the BOJ is close to intervening in the forex market to prop up the Yen, as he said it would take appropriate action, if the authorities deemed movements in the foreign currency market to be excessive.
Technical Review
USDJPY,D1 – The overall move from 151.93 is still seen as a corrective pattern. Intraday bias remains on the upside for now. The rise from 127.20 is underway for the FE61.8% projection of 146.74 (129.63 – 145.06 and 137.23 retracements). On the downside, a move below the 144.64 minor support will change the intraday bias to neutral and bring consolidation first, before determining the continued trend. For now, the price is still running below the BOJ’s September 2022 intervention threshold.
The RSI is seen floating in the overbought area and the MACD is aligned portraying a slight loss of momentum.
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Ady Phangestu
Market Analyst – HF Educational Office – Indonesia
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