Yen Extend Losses Following Japan Inflation Data

Fundamental Analysis

* Yen Falter: The Japanese Yen (JPY) weakened against the US Dollar following the release of mixed inflation data on Friday. Japan’s National Consumer Price Index (CPI) for June held steady at 2.8%, consistent with the previous month’s figure and maintaining its highest level since February. However, Core CPI inflation rose to 2.6%, slightly above the previous reading of 2.5% but just below the consensus estimate of 2.7%. Additionally, comments from Japanese government officials have influenced the market. Japan’s Digital Minister Taro Kono clarified that he is not directly urging the Bank of Japan (BoJ) to raise rates at this time, while Finance Minister Shunichi Suzuki stated that politicians should be cautious about making market-related comments due to their potential impact.

Technical Analysis

* Technical Breakout: USDJPY was traded higher while currently testing the resistance level 157.55. MACD which illustrate diminishing bearish momentum signal suggest the pair to further extend its gains after it breaks above the level.

* Resistance and Support: If the bullish momentum persists, there’s a strong likelihood that the price will potentially head towards 159.350 after it breach above the level 157.55. Conversely, a potential reversal is also to be expected and the price could head towards 155.550.

Potential Risks

Moving ahead, investors will focus on this week, mostly from the U.S due to lack of crucial Japan data, such as US Manufacturing PMI, US GDP and PCE Price Index to gauge further sentiment.

Learn more about how to navigate the prop trading landscape by checking out PU Xtrader’s trading blogs.

Monitoring

Stay updated on US and Japan data, central bank updates and any shifts in the US Dollar’s strength by following PU Xtrader’s financial news page.

Register For PU Xtrader Challenge And Start Prop Trading

Take Challenge