Published on Apr 21, 2023

Daily Analysis For USD/JPY 21-04-2023

USD/JPY Analysis

Economic Events and Scenario for USD/JPY

Economic Events: -

GMT	Event	Impact	Currency
00:00	(Australia) Judo Bank Services PMI	High	AUD
00:00	(Australia) Judo Bank Manufacturing PMI	High	AUD
00:00	(Australia) Judo Bank Composite PMI	Low	AUD
00:01	(United Kingdom) Gfk Consumer Confidence	High	GBP
00:30	(Japan) Inflation Rate Ex-Food and Energy YoY	Low	JPY
00:30	(Japan) Core Inflation Rate YoY	Medium	JPY
00:30	(Japan) Inflation Rate MoM	Low	JPY
00:30	(Japan) Inflation Rate YoY	High	JPY
01:30	(Japan) Jibun Bank Composite PMI	Low	JPY
01:30	(Japan) Jibun Bank Services PMI	Medium	JPY
01:30	(Japan) Jibun Bank Manufacturing PMI	Medium	JPY
05:00	(Japan) 3-Month Bill Auction	Low	JPY
07:00	(United Kingdom) Retail Sales MoM	High	GBP
07:00	(United Kingdom) Retail Sales YoY	High	GBP
07:00	(United Kingdom) Retail Sales ex Fuel MoM	High	GBP
07:00	(United Kingdom) Retail Sales ex Fuel YoY	High	GBP
08:00	(Euro Area) ECB Guindos Speech	High	EUR
08:15	(France) S&P Global Composite PMI	Low	EUR
08:15	(France) S&P Global Manufacturing PMI	Medium	EUR
08:15	(France) S&P Global Services PMI	Medium	EUR
08:30	(Germany) S&P Global Composite PMI	Low	EUR
08:30	(Germany) S&P Global Services PMI	High	EUR
08:30	(Germany) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) S&P Global Services PMI	High	EUR
09:00	(Euro Area) S&P Global Composite PMI	Low	EUR
09:00	(Italy) Construction Output YoY	Low	EUR
09:30	(Slovenia) Consumer Confidence	Low	EUR
09:30	(Slovenia) PPI YoY	Low	EUR
09:30	(United Kingdom) S&P Global/CIPS Composite PMI	Low	GBP
09:30	(United Kingdom) S&P Global/CIPS Manufacturing PMI	High	GBP
09:30	(United Kingdom) S&P Global/CIPS UK Services PMI	High	GBP
10:00	(Euro Area) Government Debt to GDP	Medium	EUR
10:00	(Euro Area) Government Budget to GDP	Medium	EUR
10:10	(Italy) Index-Linked BTP Auction	Low	EUR
10:10	(Italy) BTP Short Term	Low	EUR
11:00	(Ireland) Wholesale Prices MoM	Low	EUR
11:00	(Ireland) Wholesale Prices YoY	Low	EUR
13:00	(Kosovo) Balance of Trade	Low	EUR
13:30	(Canada) Retail Sales Ex Autos MoM	High	CAD
13:30	(Canada) Retail Sales YoY	High	CAD
13:30	(Canada) Retail Sales MoM	High	CAD
14:45	(United States) S&P Global Manufacturing PMI	High	USD
14:45	(United States) S&P Global Composite PMI	Medium	USD
14:45	(United States) S&P Global Services PMI	High	USD
15:30	(Slovenia) Unemployment Rate	Low	EUR
15:30	(Euro Area) ECB Elderson Speech	Low	EUR
18:00	(El Salvador) Balance of Trade	Low	USD
18:00	(United States) Baker Hughes Total Rig Count	Low	USD
18:00	(United States) Baker Hughes Oil Rig Count	Low	USD
18:45	(Euro Area) ECB Guindos Speech	High	EUR
21:35	(United States) Fed Cook Speech	Medium	USD

Today's Scenario: - In the Asian session, the USD/JPY pair has managed to hold above the critical support level of 134.00, even with the release of Japan's National Consumer Price Index (CPI) data that exceeded expectations. The annual national CPI for March showed an acceleration to 3.2%, which was higher than the consensus of 2.6% but lower than the previous release of 3.3%.

The slight decline in the headline CPI from the previous figures is due to the drop in oil prices in the global market. However, the core PCI, which eliminates the impact of volatile oil and food prices, has increased to 3.8%, surpassing the estimates of 3.4% and the previous release of 3.5%. This indicates a steady rise in retail demand, which is being supported by the ongoing ultra-loose monetary policy and stimulus measures aimed at boosting wages.

Buy Scenario: - To see a bullish session, the USD/JPY pair must surpass the pivot at 134.368 and aim for the First Major Resistance Level (R1) at 134.725 and the Thursday high of 134.871. A move towards 134.5 would indicate the bullish sentiment, but the USD/JPY requires support from US stats and Fed chatter for a successful breakout.

In case of a more extended rally, the bulls are expected to test the Second Major Resistance Level (R2) at 135.228, with the Third Major Resistance Level (R3) at 136.088. Till we did not advise to buy in USD/JPY.

Sell Scenario: - However, if the USD/JPY fails to surpass the pivot, the First Major Support Level (S1) at 133.865 will be in play. Except for a sell-off fueled by a risk-off sentiment, the USD/JPY pair should remain above sub-133.5. The Second Major Support Level (S2) at 133.508 should act as the critical level to limit the downside. The Third Major Support Level (S3) sits at 132.648. Till we did not advise to sell the position in USD/JPY.

Support and Resistance Level: -