Fundamental Overview

The US CPI yesterday came in line with expectations leading to a bit of a “sell the fact” reaction in the US Dollar.

The bullish momentum picked up a bit later though as Fed’s Logan delivered a hawkish comment saying that “models show that Fed funds could be very close to neutral” basically implying a lot more cautious approach on rate cuts in 2025.

The market is viewing all of this in light of the recent US election as Trump’s policies are likely to spur growth and potentially keep inflation above target for longer, making the Fed’s job of bringing inflation back to target a bit harder.

USDJPY Technical Analysis – Daily Timeframe

On the daily chart, we can see that USDJPY finally extended the rally into new highs helped by a hawkish comment from Fed’s Logan. There’s no strong technical resistance now at least until the 160.00 handle.

If we get a pullback, the buyers will likely lean on the trendline with a defined risk below it to position for a rally into the 160.00 handle. The sellers, on the other hand, will want to see the price breaking lower to start targeting a drop back into the 152.00 support.

USDJPY Technical Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we have a minor upward trendline defining the current bullish momentum. If we get a pullback, the buyers will likely lean on it to position for new highs, while the sellers will look for a break lower to target a break below the major trendline.

USDJPY Technical Analysis – 1 hour Timeframe

On the 1 hour chart, there’s not much else we can add as from a risk management perspective, the buyers will have a better setup around the trendline, while the sellers are better to wait for a technical break lower instead of trying to catch the top. The red lines define the average daily range for today.

Upcoming Catalysts

Today we have the US PPI and the US Jobless Claims figures. Tomorrow, we conclude the week with the US Retail Sales data.

See the video below

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The USD is higher in trading today as the Trump trade continues. HIgher USD. Higher stocks. Bonds we don't know as the bond market is closed for Veterans Day today. Gold is lower but bitcoin in higher.

In this video, I take a look at the EURUSD, USDJPY and GBPUSD from a technical perspective.

EURUSD: The EURUSD fell below the swing lows from June between 1.0665 to 1.06705. That is below the low from last week at 1.06819. Staying below that area keeps the sellers in control. Absent a move above those levels and the buyers are not winning. ON the downside, the next support comes in at 2024 lows between 1.0600 to 1.06097.

USDJPY: The USDJPY has bounced higher and pushed to the 153.88 level. That level has helped to slow the run higher today. Recall from last week, the price did move above that level and ran to a high of 154.70 on the dollar buying after the Election before the corrective move lower (the price bottomed at the 100 bar MA on the 4-hour chart). So the pair is at a key technical level between support at the 100 bar MA on the 4-hour chart, and the high from last week at 154.70.

GBPUSD:The GBPUSD has seen more up-and-down momentum over the last few weeks of trading. It is trading near the low of that up and down range with 1.2832 to 1.2872 the swing area to get to and through to increase the bearish bias. On the topside gettting back above the low from 3 weeks ago comes in at 1.29065. That would need to be broken to give the buyers more confidence.

This article was written by Greg Michalowski at www.forexlive.com.

Fundamental Overview

The puzzling weakness in the US Dollar following Trump’s victory looks more and more like it was just a “sell the fact” reaction. The greenback is now back in the driving seat, and we might also be seeing some pre-positioning into a potentially hot US CPI report tomorrow.

At the latest Fed’s decision, Fed Chair Powell said that they expect bumps on inflation and that one or two bad data months on inflation won’t change the process. This keeps the 25 bps cut in December in place even if we get higher inflation readings.

The market though is forward-looking, and the rise in Treasury yields showed that the market sees risks to the inflation outlook. Moreover, the red sweep could increase those fears if the progress on inflation stalls, or worse, reverses.

USDJPY Technical Analysis – Daily Timeframe

On the daily chart, we can see that USDJPY continues to consolidate above the key 152.00 support zone maintaining a bullish bias. If we were to get another pullback into the support, we can expect the buyers to step in once again to position for a rally into the 160.00 handle. The sellers, on the other hand, will want to see the price breaking lower to pile in for a drop into the 148.00 handle next.

USDJPY Technical Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we have a minor upward trendline defining the current bullish momentum. The price recently bounced near the trendline and we can expect the buyers to keep leaning on it, while the sellers will look for a break lower to gain more conviction for a bigger correction to the downside.

USDJPY Technical Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we have a minor support zone around the 153.40 level. This is where the buyers are stepping in with a defined risk below the zone to position for the continuation of the uptrend. The sellers, on the other hand, will want to see the price breaking lower to target a pullback into the trendline. The red lines define the average daily range for today.

Upcoming Catalysts

This week is a bit empty on the data front with the most important releases scheduled for the latter part of the week. Tomorrow, we have the US CPI report. On Thursday, we get the latest US Jobless Claims figures. On Friday, we conclude the week with the US Retail Sales data.

See the video below

This article was written by Giuseppe Dellamotta at www.forexlive.com.

In the kickstart video, I take a look at the 3 major currency pairs:

EUR/USD Summary

The EUR/USD continued its downward trend due to concerns over slower economic growth and increased tariffs under President-elect Trump.

Key Points:

• Initially rose in the Asian session, but sellers took control near 1.0665-1.06703 swing area. That area was the lows from back in June.

• Staying below the lows from June kept the sellers in control

• Reached a low of 1.0606, testing April's swing lows and the year's lows (since October 2023). A move below the 1.0600 increases the bearish bias.

• Buyers may lean against the low as risk can be defined and limited against the level with stops on a break below.

-------------------------------------------

USD/JPY Summary

The USD/JPY exhibited volatility, with potential bullish signals.

Key Points:

1. Rose yesterday, then stalled between 153.59-153.88 (swing area).

2. Found support at 153.397 (61.8% of July's move down).

3. Broke above 153.88 (bullish signal).

4. Next targets: 154.54-155.09.

Outlook:

Bullish Scenario

Stay above 153.88, targeting 154.54-155.09.

Bearish Scenario

Move below 153.397 increases short-term bearish bias.

--------------------------------------------------

GBP/USD Summary

The GBP/USD fell, breaking below two-week lows and the 200-day MA.

Key Points:

1. Broke below last week's low (1.28329) and 200-day MA (1.28178).

2. Reached 1.27915, then bounced.

3. Traded above and below 200-day MA.

Outlook:

Bullish Scenario

Move above 1.28329, 1.2844, and 1.2866 (50% of April's move) indicates buyer strength.

Bearish Scenario

Stay below 1.28329 and 1.2844 maintains seller confidence; breaking below 200-day MA again confirms bearish trend.

This article was written by Greg Michalowski at www.forexlive.com.

The USDJPY is extending to a new session high after testing is 61.8% retracement earlier in the day at 153.397 and finding willing buyers.

The market to the upside has now taken the price to a high of 154.75. That has extended above the high price from last week at 154.704. The buyers are making a play.

The swing high going back to July 30 came in at 155.21, and that becomes the next key target on the topside for the pair.

This article was written by Greg Michalowski at www.forexlive.com.