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Nikkei's Break To New Highs Puts USD/JPY On The Radar
Renewed trade optimism and strong earnings saw Asian shares break higher. With Nikkei 25 breaking a new cycle high, we're closely watching USD/JPY to see if it follows suit.
USD/JPY may follow Nikkei’s big breakout after Japanese elections
Underscoring investors’ insatiable appetite for risk, Japan’s main Nikkei index rose for the 14th consecutive day, which was one the longest winning streaks ever recorded. The USD/JPY, which tends to rise and fall in tandem with stocks, also gained ground, helping the Dollar Index to break its two-day losing streak.
Nikkei: double bottom reversal or just an oversold bounce?
As we reported earlier today, crude oil is currently driving almost everything at the moment. In particular, it has been correlating positively with the equity markets due to oil’s obvious impact on the energy stocks. So, when oil prices bounced back from the key $30 handle today, the severely oversold energy stocks jumped and global indices and index futures have correspondingly rallied. US markets have been supported further by forecast-beating earnings from JPMorgan, which has lifted hopes that the rest of Wall Street banking giants will also provide positive or at least better-than-expected numbers over the next several days.
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