Published on May 17, 2023

Daily Analysis For USD/JPY 17-05-2023

USD/JPY Analysis

Economic Events and Scenario for USD/JPY

Economic Events: -

GMT	Event	Impact	Currency
00:00	(United States) Fed Bostic Speech	Medium	USD
00:50	(Japan) GDP Price Index YoY	Low	JPY
00:50	(Japan) GDP Capital Expenditure QoQ	Low	JPY
00:50	(Japan) GDP External Demand QoQ	Low	JPY
00:50	(Japan) GDP Private Consumption QoQ	Low	JPY
00:50	(Japan) GDP Growth Rate QoQ	High	JPY
00:50	(Japan) GDP Growth Annualized	High	JPY
02:30	(Australia) Wage Price Index QoQ	Low	AUD
02:30	(Australia) Wage Price Index YoY	Low	AUD
02:30	(China) House Price Index YoY	Medium	CNY
04:35	(Japan) 20-Year JGB Auction	Low	JPY
05:30	(Japan) Capacity Utilization MoM	Low	JPY
05:30	(Japan) Industrial Production MoM	Low	JPY
05:30	(Japan) Industrial Production YoY	Low	JPY
05:30	(Netherlands) Unemployment Rate	Medium	EUR
06:30	(France) Unemployment Rate	Medium	EUR
07:00	(European Union) New Car Registrations YoY	Medium	EUR
08:00	(China) FDI (YTD) YoY	Medium	CNY
08:00	(Austria) Harmonised Inflation Rate YoY	Low	EUR
08:00	(Austria) Harmonised Inflation Rate MoM	Low	EUR
08:00	(Austria) Inflation Rate MoM	Low	EUR
08:00	(Austria) Inflation Rate YoY	Low	EUR
08:00	(Austria) CPI	High	EUR
08:00	(Slovakia) Harmonised Inflation Rate YoY	Low	EUR
08:00	(Slovakia) Harmonised Inflation Rate MoM	Low	EUR
09:00	(Italy) Balance of Trade	Medium	EUR
10:00	(Cyprus) Harmonised Inflation Rate YoY	Low	EUR
10:00	(Euro Area) Inflation Rate MoM	Low	EUR
10:00	(Euro Area) Core Inflation Rate YoY	Low	EUR
10:00	(Euro Area) Inflation Rate YoY	Medium	EUR
10:00	(Euro Area) CPI	High	EUR
10:00	(France) 5-Year OAT Auction	Low	EUR
10:00	(France) 3-Year OAT Auction	Low	EUR
10:00	(Malta) Inflation Rate YoY	Low	EUR
10:00	(Euro Area) ECB Elderson Speech	Low	EUR
10:30	(Germany) 10-Year Bund Auction	Medium	EUR
10:30	(Euro Area) ECB Panetta Speech	Low	EUR
10:50	(United Kingdom) BoE Gov Bailey Speech	Medium	GBP
11:00	(Spain) Consumer Confidence	Medium	EUR
11:00	(Ireland) Residential Property Prices MoM	Low	EUR
11:00	(Ireland) Residential Property Prices YoY	Low	EUR
11:00	(France) 10-Year Index-Linked OAT Auction	Low	EUR
11:00	(Ireland) Balance of Trade	Low	EUR
11:10	(European Union) 3-Month Bill Auction	Low	EUR
11:10	(European Union) 6-Month Bill Auction	Low	EUR
11:30	(United Kingdom) 5-Year Treasury Gilt Auction	Low	GBP
12:00	(United States) MBA 30-Year Mortgage Rate	Medium	USD
12:00	(United States) MBA Mortgage Applications	Low	USD
12:00	(United States) MBA Mortgage Refinance Index	Low	USD
12:00	(United States) MBA Mortgage Market Index	Low	USD
12:00	(United States) MBA Purchase Index	Low	USD
13:30	(Canada) New Motor Vehicle Sales	Low	CAD
13:30	(Canada) Foreign Securities Purchases by Canadians	Low	CAD
13:30	(Canada) Foreign Securities Purchases	Low	CAD
13:30	(United States) Building Permits MoM	Medium	USD
13:30	(United States) Housing Starts MoM	Medium	USD
13:30	(United States) Housing Starts	Medium	USD
13:30	(United States) Building Permits	High	USD
15:30	(United States) EIA Refinery Crude Runs Change	Low	USD
15:30	(United States) EIA Crude Oil Stocks Change	Medium	USD
15:30	(United States) EIA Distillate Stocks Change	Low	USD
15:30	(United States) EIA Heating Oil Stocks Change	Low	USD
15:30	(United States) EIA Gasoline Production Change	Low	USD
15:30	(United States) EIA Crude Oil Imports Change	Low	USD
15:30	(United States) EIA Gasoline Stocks Change	Medium	USD
15:30	(United States) EIA Cushing Crude Oil Stocks Change	Low	USD
15:30	(United States) EIA Distillate Fuel Production Change	Low	USD
16:15	(Euro Area) ECB Guindos Speech	High	EUR
16:30	(United States) 17-Week Bill Auction	Low	USD
17:00	(Canada) 3-Year Bond Auction	Low	CAD
18:00	(United States) 20-Year Bond Auction	Low	USD
23:45	(New Zealand) PPI Input QoQ	Low	NZD
23:45	(New Zealand) PPI Output QoQ	Low	NZD

Today's Scenario: - USD/JPY is experiencing a pullback from its intraday high at 136.35, putting an end to its five-day winning streak. The retreat is driven by positive growth numbers released by Japan early Wednesday. Additionally, the pair is facing downward pressure due to the US Dollar's decline as concerns about a US default ease. However, the direction of the Yen pair remains uncertain as hawkish statements from the Federal Reserve (Fed) combine with positive data from the US.

The preliminary reading of Japan's Gross Domestic Product (GDP) for the first quarter (Q1) of 2023 exceeded expectations, showing a 0.4% quarter-on-quarter (QoQ) growth compared to the anticipated 0.1% and the previous figure of 0.0%. In response to the data, a Japanese government official commented that Q1 GDP marks the first QoQ gain in three quarters.

Buy Scenario: - USD/JPY is currently approaching its resistance level, which has been established from the high on March 8 at 137.91. The pair is forming an Ascending Triangle pattern on the daily chart, indicating a decrease in volatility. The upward-sloping trendline, originating from the low on March 24 at 129.64, continues to provide support for USD/JPY bulls.

The 10-period Exponential Moving Average (EMA) at 135.60 is moving higher, indicating strength in USD/JPY.

The Relative Strength Index (RSI) with a period of 14 is attempting to shift into the bullish range of 60.00 to 80.00, which would activate upward momentum.

If the pair breaks above Tuesday's high at 136.68, it will drive USD/JPY towards the high of March 2 at 137.10 and the two-month high at 137.91. Till we did not advise to buy in USD/JPY.

Sell Scenario: - On the downside, a movement below the high of May 10 at 135.47 will strengthen the Japanese Yen bulls, leading to a decline in the USD/JPY pair towards the high of May 11 at 134.84, followed by the low of May 11 at 133.74. Till we did not advise to sell the position in USD/JPY.

Support and Resistance Level: -