FOREX: Japanese Yen Extends Post-Election Recovery
Feb-10 10:38
- The Japanese yen has strengthened after Finance Minister Katayama calmed markets on the timing and financing of the sales tax cut for food. Downside momentum for USDJPY has picked up pace, extending the reversal from yesterday’s post-election high to around 1.6%, and printing a pullback low of 155.09.
- Price action increasingly blurs the technical picture for USDJPY as spot is cleanly below through the 50-day EMA which may bolster the short-term bearish outlook. The 100-day MA intersects at 154.52.
- The January acceleration in Norwegian CPI-ATE looks broad-based, with start-of-year price resets in the likes of rents and insurance highlighted. Any scope for payback in February won't be enough to ease Norges Bank concerns around inflation persistence, which leads EURNOK 0.35% lower with initial support at the Jan 29 low of 11.3610.
- Last week’s stabilisation and then subsequent recovery for risk have spurred an impressive 2.9% AUDUSD rebound from Friday’s low. This culminated in AUDUSD printing a fresh cycle high late Thursday, at 0.7099, the highest level since February 2023. While the 0.71 handle has capped the price action overnight, the session range has remained narrow, allowing the pair to consolidate the solid bounce.
- GBP consolidates its recovery seen yesterday afternoon following PM Starmer securing the public support of every cabinet minister after his future came under threat for his involvement with former ambassador Mandelson. Any market caution around Starmer's future has two legs as the fiscal angle adds to political instability. 1.37 has been capping short-term gains for GBPUSD.
- Separately, downside momentum for EURCHF has extended on Tuesday, resulting in fresh lows at 0.9120 today, the lowest level since the removal of the peg in 2015.
- US retail sales, ECI, import and export prices, redbook retail sales, and business inventories are on the calendar ahead of US payrolls (Wed) and CPI (Fri).
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AUSSIE 3-YEAR TECHS: (H6) Recovery Mode
Jan-10 22:45
- RES 3: 97.796 - 1.618 proj of the Sep 3 - 12 - 15 price swing
- RES 2: 96.780 - High Jun 26 (cont)
- RES 1: 96.700 - High Sep 12
- PRICE: 95.890 @ 16:40 GMT Jan 9
- SUP 1: 95.740 - Low Dec 22
- SUP 2: 95.480 - Low 1st Nov ‘23
- SUP 3: 94.932 - 1.0% 10-dma envelope
Prices bounced again Thursday, supported by strength in global bond markets and a smoother inflation picture at the December CPI print. As such, prices edged further away from recent lows. Nonetheless, slower pricing for additional RBA easing - and partial pricing for a return to rate hikes in 2026 - should keep the front-end of the curve under pressure. This keeps prices well below prior resistance at 96.615, the Sep 12 high, and refocuses attention on 95.480 as the next major support.
MNI: MNI TEST 02, Please Ignore
Jan-09 23:36
Test Test TEST
MNI: MNI Test, Please Ignore
Jan-09 23:30
Test, ignore
