USDJPY TECHS: Northbound
- RES 4: 147.49 2.00 projection of the Jul 14 - 21 - 28 price swing
- RES 3: 146.59 High Nov 10 2022
- RES 2: 146.38 1.764 projection of the Jul 14 - 21 - 28 price swing
- RES 1: 145.93 High Aug 16
- PRICE: 145.46 @ 17:12 BST Aug 16
- SUP 1: 143.89 High Aug 3
- SUP 2: 143.03/141.55 20- and 50-day EMA values
- SUP 3: 138.07 Low Jul 28
- SUP 4: 137.25 Low Jul 14 and key support
The uptrend in USDJPY remains intact and the pair touched a fresh cycle high of 145.93 Wednesday. Recent gains resulted in a break of resistance at 145.07, Jun 30 high, confirming a resumption of the uptrend and maintaining the bullish price sequence of higher highs and higher lows. MA studies are in a bull mode condition, highlighting bullish sentiment. The focus is on 146.38, a Fibonacci projection. Initial support to watch is 143.03, the 20-day EMA.
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USDJPY TECHS: Pullback Hits Pause
- RES 4: 144.20 High Jul 7
- RES 3: 143.01 High Jul 10
- RES 2: 141.68 20-day EMA
- RES 1: 139.40/140.18 High Jul 17 / 50-day EMA
- PRICE: 139.04 @ 15:37 BST Jul 17
- SUP 1: 137.25 Low Jul 14
- SUP 2: 136.57 4.0% 10-dma envelope
- SUP 3: 136.31 Low May 17
- SUP 4: 135.53 61.8% retracement of the Mar 24 - Jun 30 bull leg
The pullback in USDJPY paused to begin the week, warding price action away from entering a technically oversold condition. Despite the pause, the bear cycle that started Jun 30 is still underway. The recent sell-off has resulted in a break of both the 20- and 50-day EMAs and price is back inside the bull channel drawn from the Jan 16 low. A continuation lower would open 136.57, the lower band of a moving average envelope. Initial firm resistance is at 140.18, the 50-day EMA. A break of this average would ease bearish pressure.
CANADA: Scotia Above Consensus For CAD CPI
- Scotia are at the top end of a relatively narrow analyst range of 2.9-3.1% Y/Y for headline CPI in June.
- Their estimate is based off headline CPI increasing 0.3% M/M in both SA and NSA terms, but with traditional core up 0.4% M/M seasonally adjusted for a 3-month rate pushing to circa 3.9% from 3.6% annualized.
- Among the things to watch for will be service price inflation that has remained hot, and whether the prior month’s deceleration in goods price inflation will persist.
- However, they see this week’s CPI report as probably just a placeholder that sparks market volatility without settling positioning for the BoC’s next potential move.
US: 47% Of Americans Believe Country Is In Recession
A new survey from YouGov has found that, “Despite incremental improvements in the U.S. economic situation — including the inflation rate reaching a two-year low in June — American views of the state of the economy remain quite negative.”
- YouGov: “Nearly half of Americans (47%) believe the U.S. is currently in recession; an additional 21% say a recession is very or somewhat likely in the next year. Republicans (66%) are more than twice as likely as Democrats (31%) to say we're currently in a recession. Another 21% of Americans think a recession within the next 12 months is very (3%) or somewhat (18%) likely.”
- The survey is the latest in a stream of surveys which suggest that Biden administration claims that the US economy is proving resilient and inflation is easing are failing to filter through to voters.
- The White House will be concerned that a recent "Bidenomics" drive to argue merits of the Biden administration's domestic economic agenda isn't resonating with voters.
Figure 1: About Half of Americans say the U.S. Economy is in Recession
Source: YouGov
