June 29, 2022

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USDJPY beraks above 200 hour moving average and topside trendline after stronger CPI

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200 hour moving average and trendline cuts across 109.05.

The USDJPY as spite higher after the shore than expected CPI data. The price has moved back above its 200 hour moving average and a Topside trendline on the hourly chart. Both cut across at 109.05. The high prices reach 109.21 so far. 

200 hour moving average and trendline cuts across 109.05._

Stay above those technical levels in that buyers remain in firm control. Other support comes in between 108.89 and 108.933 and the 100 hour moving average at 108.844. A move back below the 100 hour MA would be a sharp shift of sentiment after the data. 

The Friday high price at 109.283 is the next upside target. Above that a swing area between 109.417 and 109.48 would be eyed (see yellow area and red numbered circles).

In the the premarket for US stocks, there is some back tracking of the declines.

  • Dow futures implying -88 point decline
  • S&P is down -22 points 
  • NASDAQ index -152 points

Volatility in premarket trading could see spill-over reactions in the forex market and other markets.

The five year yield is now up 0.37 basis points at 0.837%. The 10 years up 2.5 basis points at 1.646%. There is now a 100% chance of a Fed tightening by December 2022. That is up from 88% prior to the report.

PS. As Adam outlined, the price of used cars and trucks data for 1/3 of the rise, but there also was other increases as well.  That rise in used car prices is one of those transitory increases due to supply constraints the Fed official seven speaking about.  

PSS Fed’s Clarida does speak at the top of the hour and the market will get the first thoughts from a Fed official.

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