The small rise of the Yen, markets waiting for the rate decision

A series of small gains, is characterizing the opening of the London session for the Yen, which currently is trading higher against the main G10 currencies.

Gains due in particular to the Asian equity sell-off which is now bringing the Nikkei 225 to the 17.439 level, with a negative performance of 0,76%, and by a stall in the purchase on the Oil market.

The EUR/JPY pair meanwhile is moving down 0,23% at almost 125,00 and seems to extend the yesterday’s flat movement. The Euro currency make it difficult to regain ground while the bears continue to influence the general risk-sentiment of the market.

Moreover the EUR/USD seem to influence the negative trend of the cross, having difficult to regain ground and making a negative performance too, with the USD again to the front foot.

EUR:JPY 26apr

Even the USD/JPY cross is going down, making a -0,19% performance at 110,00 after the Japanese equity pullback.

At the time of writing the equity market seem to be the principal market mover, while the US currency could be affected by the release of the Durable Goods data, expected for today’s NY session. A possible rebound to the 1,9% for the March data is expected against a negative figure of 3,0% for the last month.

USD:JPY 26apr

Regarding this week, however, the 2 cross are seen with a neutral view, looking for the monetary policy decision for both BOJ and Fed. Following a Bloomerg survey, the possibility of a BOJ rate cut within July is 93% and it is not excluded that even the Thursday meeting could hold some surprises. Governor Kuroda in the meantime, during a parliament speech, stated that the impact of the negative rates on banks is extremely limited, indicating a willingness to cut rates on the short therm.

Bank-of-Japan-negative-interest-rates

Technical levels for the EUR/USD pair are seen at 125,50 to the up, while on the opposite front the first significant support is seen at 124,61 (22 March low), which broken could bring the pair to the second one at 124,00.

On the other hand, considering the USD/JPY cross, the first resistance is seen at 111,88 while the first important support is at 110,81 followed by 110,09.

 

 

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