USD / JPY PRICE OUTLOOK: STRONG PMI DATA CAN DRIVE STEERING WHEEL AND DOLLAR HIGHER
- The US dollar on Thursday with a whip and helped DXY index -0.3% reversal of the decline
- USD / JPY price behavior weakened as Treasury bond yields sought to widen their setbacks
- Flash PMIs scheduled for tomorrow may consider risk trends first FOMC
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The US dollar bulls and bears fought for a directional check during Thursday’s trading session only to see the DXY index close virtually smoothly. The broader US dollar weakened by as much as -0.3% during the intraday slump, which seemed to follow the decline in Treasury profitability following weekly data on disappointing unemployment claims.
It dragged on USD/JPY 17 points less per session. The Decision of the ECB weighed the US dollar, albeit indirectly, but EUR / USD a price that includes 57.6% of the return on the DXY index. This means that markets can expect the risk of future events stemming from the release of time-limited PMIs on Friday, July 23, on hints of the US dollar moving forward.
DXY – US DOLLAR INDEX PRICE CARD: DAILY SCHEDULE (FEBRUARY 19 – JULY 22, 2021)
Better-than-expected US PMI data could see the dollar strengthen further, especially as both employment and inflation components show signs of strength. It is considering how reliable economic data will keep Federal Reserve officials hot on the timing of restricting asset purchases. On the other hand, if fast PMIs are lower than forecast, we will see the US dollar shrink as markets continue to relax Fed restricted bets.
USD PRICE OUTLOOK – US DOLLAR INDIRECT TRADE AREAS (NIGHT)
It is worth noting that overnight indirect volatility The US dollar readings seem rather muted. This suggests that markets may remain irregular and spread tomorrow, a scenario that could be reinforced by relatively straightforward PMI data. Looking forward to our coming week Economic calendarhowever, we see that the Fed interest rate decision should come next Wednesday, July 28 at 18:00 GMT.
This can be expected to imply higher volatility in upcoming trading sessions. As such, staying nimble is likely to make sense. Against this background, I will closely monitor Treasury bond yields on Friday and throughout the next week as a potential impediment to USD / JPY price trends, given their generally strong direct relationship.
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