News analisis

USD/JPY rises above 101.50

The USD/JPY managed to advance somewhat during the European session buoyed by the improvement in risk sentiment and hit a 4-day high before losing momentum.

The USD/JPY managed to advance somewhat during the European session buoyed by the improvement in risk sentiment and hit a 4-day high before losing momentum.

The USD/JPY climbed to a peak of 101.57 but is having a hard time finding follow through with no much in the data front to give the pair a boost during the NY trade but the BoJ will decide on monetary policy next Asian session. The USD/JPY is consolidating near highs at the 101.50 area ahead of the Wall Street opening, recording a 0.18% gain on the day.

USD/JPY technical outlook

“The intraday bias is positive, but the downtrend from 102.25 high is still intact, so my outlook is bearish, for a slide towards 100.70”, said Stoyan Mihaylov, analyst at DeltaStock.com. “Crucial on the upside is 101.85”.

EUR, GBP and USD in the spotlight this week - Investec

Jonathan Pryor, Corporate Treasury Analyst at Investec, remarks the key events for this week....

Jonathan Pryor, Corporate Treasury Analyst at Investec, remarks the key events for this week.

Key Quotes

"On Tuesday we have a very busy day with UK Inflation data, UK BRC Retail Sales monitor, UK ONS House price data, German ZEW surveys all in the morning. US Retail Sales will be a key release and also US Empire Manufacturing for July, both in the afternoon at 13:30."

"The ECB's Noyer speaks on Consumer Credit, Bank of England Governor Mark Carney and three others testify before the House of Commons Treasury Committee on the June Financial Stability Report, the report in which the Committee previously put tighter Mortgage controls in place. In politics, the European Parliament vote on whether former Luxembourg Prime Minister Junker will become the President of the European Commission."

"If that wasn’t enough the main event is day one of Federal Reserve Chair Janet Yellen delivering her semi annual testimony to the Senate Banking Committee, on the outlook for the economy. Yellen will face questions about the Fed’s eventual step-back from its ultra-loose policy stance which will be the key focus from an FX perspective".

GBP/USD sidelined above 1.7100

The sterling is now following its risk-associated peers on Monday, taking the GBP/USD to the 1.7115/10 band so far...

The sterling is now following its risk-associated peers on Monday, taking the GBP/USD to the 1.7115/10 band so far.

GBP/USD supported around 1.7100

Despite the lack of positive events and less auspicious data releases as of late, the pound is managing quite well to keep the trade above the 1.7100 handle so far. Adding to the buoyancy of the GBP, market expectations for a rate hike sooner than estimated by the BoE still hover amongst traders. “The key levels highlighted previously at 1.7085 and 1.7180 are still intact. For today,, a recovery toewards 1.7150 wil not be surprising but unless there is a break above 1.7180, this should be followed by a move lower towards 1.7085”, noted Quek Ser Leang, Market Strategist at UOB Group.

GBP/USD relevant levels

As of writing the pair is up 0.01% at 1.7115 and a surpass of 1.7150 (high Jul.11) would open the door to 1.7168 (high Jul.10) and finally 1.7180 (2014 high Jul.2). On the downside, the initial support aligns at 1.7092 (low Jul.11) ahead of 1.7081 (38.2% of 1.6920-1.7180) and then 1.7074 (21-d MA).

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