European Open: USD/JPY bulls return in style
The combination of a strong US inflation report and a (predictably dovish) new BOJ governor on the radar saw USD/JPY print an impressive bullish engulfing day
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Asian Indices:
- Australia's ASX 200 index fell by -94.7 points (-1.3%) and currently trades at 7,212.30
- Japan's Nikkei 225 index has fallen by -40.69 points (-0.15%) and currently trades at 27,412.79
- Hong Kong's Hang Seng index has fallen by -151.83 points (-0.76%) and currently trades at 19,858.21
- China's A50 Index has risen by 5.54 points (0.04%) and currently trades at 13,361.17
UK and Europe:
- UK's FTSE 100 futures are currently up 29 points (0.37%), the cash market is currently estimated to open at 7,907.66
- Euro STOXX 50 futures are currently up 6 points (0.14%), the cash market is currently estimated to open at 4,184.82
- Germany's DAX futures are currently down -3 points (-0.02%), the cash market is currently estimated to open at 15,206.74
US Futures:
- DJI futures are currently up 20 points (0.06%)
- S&P 500 futures are currently up 28.25 points (0.24%)
- Nasdaq 100 futures are currently up 5.5 points (0.14%)
- BOE member Ben Broadbent speaks at 09:00 GMT: Opening remarks at the BEAR Research Conference: New Digital Technologies and the Future Financial Landscape
- Another hot US inflation print weighed on sentiment on Friday, sending al three major US benchmarks lower
- Predictably, that has weighed on gold prices which now trade around $1803, just shy of our $1800 target – a level I suspect will hold as support
- US yields continue to climb on growing expectations of a more hawkish Fed, with the 2-year closing at its highest level since 2007 on Friday
- Oil prices are little changed, which are supported lower supply from Russia’s reduced output, versus high interest rates and expected lower demand
- There’s no major economic data scheduled for today, so perhaps we’re in for a quiet one
USD/JPY 1-hour chart:
The combination of a new dove at the helm of BOJ and a strong US inflation report saw USD/JPY print a convincing bullish engulfing day. Prices have since pulled back, and now in a period of consolidation around last week’s highs. The game plan from here is simple; any pullback to the 135.74 area / weekly picot point will pique our bullish interest, for a move to the 137.50 area.
Economic events up next (Times in GMT)
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