FED: Higher Gasoline Prices on Geopolitics Tend Not to Have Lasting CPI Affect
- Powell says regarding potential for poorer data collection from Federal agencies: "we are starting to see layoffs and important gatherers of data are saying that they're having to cut back on the size of their surveys. That's going to lead to more volatility in the surveys."
- Powell asked about higher gasoline prices due to the Israel-Iran conflict - Powell says it's "possible" we'll get higher energy prices, but those don't tend to have lasting effects on inflation.
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EURJPY TECHS: Monitoring Support At The 50-Day EMA
- RES 4: 166.69 High Oct 31 2024 and a key resistance
- RES 3: 166.10 High Nov 6
- RES 2: 165.21/43 High May 13 / High Nov 8 2024
- RES 1: 164.07 High May 15
- PRICE: 163.05 @ 16:40 GMT May 19
- SUP 1: 162.23/15 50-day EMA / Intraday low
- SUP 2: 161.60 Low May 6
- SUP 3: 160.99 Low Apr 22
- SUP 4: 159.48 Low Apr 9
EURJPY maintains a bearish tone following the pullback from its recent high. The move down is for now, considered corrective. However, the cross is testing a key support at 162.23, the 50-day EMA. A break of this level would undermine a bearish theme and signal scope for a deeper retracement. For bulls, a resumption of gains would refocus attention on key resistance and the bull trigger at 165.21, the May 13 high.
US INFLATION: Manheim Used Vehicle Index Down M/M, Potential CPI Pullback Ahead
Manheim Auctions's gauge of US used vehicle prices fell by the most in 13 months at-1.1% in May (after +2.8% the prior month), more or less returning the index level to where it was at the start of the year.
- On an individual month-to-month percentage change basis the series hasn't corresponded particularly well with CPI used vehicles, with Manheim instead working with a very rough 2-month lead. The last two months, used vehicle prices in CPI have dropped 0.5% M/M and 0.7% M/M.
- Manheim points to a potential uptick in May/June CPI before pulling back, but it's unknown how much of the price effect is tariff- and tariff-front-running related.
USDJPY TECHS: Testing Support At The 20-Day EMA
- RES 4: 150.49 High Apr 2
- RES 3: 149.28 High Apr 3
- RES 2: 148.54/65 76.4% of Mar 28 - Apr 22 bear leg / High May 12
- RES 1: 146.29 50-day EMA
- PRICE: 144.89 @ 16:39 BST May 19
- SUP 1: 144.67/143.45 Low May 19 / Low May 8
- SUP 2: 142.36 Low May 6
- SUP 3: 141.97 Low Apr 29
- SUP 4: 139.89 Low Apr 22 and a bear trigger
USDJPY continues to trade below the May 12 high and the pair maintains a softer tone. The latest pullback underpins the view that gains since Apr 22 appear corrective. A stronger reversal lower would refocus attention on 142.36, the May 6 low. First support to watch is 145.21, the 20-day EMA. It has been pierced, a clear break would strengthen a bearish theme. Key short-term resistance has been defined at 148.65, the May 12 high.
