We want to perceive ourselves as winners but successful traders are always focusing on their losses
USD
EUR/USD
The Shared currency climbed to $1.1927 as the U.S. Federal Reserve, including Chairman Jerome Powell, sought to reassure markets that the tighter monetary policy hinted at in the Fed’s latest policy decision was still some way off.
GBP/USD
The Sterling gained to $1.3942 on positive vibes from Brexit chaos, U.K PMI data eyed.
USD/JPY
The Japanese yen dropped to 110.81 versus the greenback, with Japan releasing both its manufacturing and services purchasing managers’ index for June earlier today. The manufacturing PMI stood at a lower-than-expected 51.5.
AUD/USD
The Aussie dollar gained to $0.7541 after Reserve Bank of Australia Assistant Governor Luci Ellis backed easy money policy with eyes on employment, inflation.
USD/CAD
The Loonie rose to 1.2321 per U.S dollar ahead of Canadian Retail Sales and US PMI.
USD/ZAR
South Africa's rand ticked up to 14.25 against the U.S dollar on U.S. Federal Reserve Chair Jerome Powell's testimony before Congress.
USD/MUR
The local pair idled at 41.45(selling) today.
11:30 - EUR - German Manufacturing PMI (Jun)
12:30 - GBP - Manufacturing PMI
12:30 - GBP - Services PMI
12:30 - GBP - Composite PMI
16:30 - CAD - Core Retail Sales (MoM) (Apr)
18:00 -USD - New Home Sales (May)
“ Its not that I am so smart. Its just that I observe the market longer. Patience is key to success.” - Anonymous
Policy statement from the US Federal Reserve certainly helped fuel a spike upwards in the USDJPY which topped exactly in the 110.80-111.00 resistance zone ( Based on our previous forecast on 28.05.21) before trimming most of its post Fed gains. What next?
The Bank of Japan kept its policy unchanged today and held its negative interest rate firm while also holding steady to its quantitative easing program in contrast with the FED. The special COVID program is also extended till March 2022. The lag in economic recovery has put institutions under stress , with BOJ responding that they will announce new loan measures in the near term.
The sudden burst of volatility and uncertainty will continue to prevail in the market in the coming sessions. The forex pair , hovering near critical values of 110.80-111.00, remains a key pivot in the near term. 110.80 marks a complete A-B-C corrections as per Elliott wave principle which coincides also with 100% Fibo Extension. A strong break and close above these levels could signal medium term buying in the USD amid breach of stop losses.
Shorts in USDJPY can be initiated in the region of 110.50-110.80 with a stop above 111 with targets towards 109 and 108 levels.
