2023-09-09 01:00:00
Written by: Naoto Ono, Gaitame.com Research Institute
table of contents
Date of writing: 13:40 on September 8, 2023
Expectations to reach 150 yen increase; be wary of Stochastic sell signal
USD/JPY is unstable in the high range for the week of September 4th
The US dollar/yen pair rose to 147.869 yen as concerns about intervention and expectations for a weaker yen balanced against each other, but the pair failed to find any clues to break above 148 yen, and the pair generally oscillated around the 147 yen level. Ta. It has also been pointed out that during the appreciation phase, the yen is under downward pressure due to the depreciation of the Chinese yuan. (Each rate level is as of the time of writing)
FX live streaming, dollar yen, live intervention due to next sharp rise? (September 7, 2023)
*Market trends are also explained on a program broadcast by Gaitame.com Research Institute’s TEAM Harrons.
Will price indicators be a factor pushing up the US dollar?
The US dollar/yen pair continues to stall at just below 148 yen. The US August Consumer Price Index (CPI) on the 13th, the US August Retail Sales and the US August Wholesale Price Index (PPI) on the 14th will break this trend, and the authorities’ efforts to keep the yen from depreciating will further heat up. It will be interesting to see whether it will push USD/JPY up to that level. Although the core CPI for August is expected to ease inflationary pressures compared to the previous year, the overall CPI is expected to accelerate compared to the previous year, and the outlook for the results is mixed. However, given the rise in energy prices and the rise in the price index of business confidence surveyed by ISM (Institute for Supply Management), it may be time to be wary of a resurgence of inflation rather than a slowdown.
In addition, there are concerns that rising procurement costs for companies that provide goods and services will push up PPI, which could lead to a resurgence of inflation and heightened concerns about US inflation. Currently, about 90% of the FOMC’s September FOMC forecast for a rate hike has been factored in, but if this percentage declines and expectations for a rate hike increase, the USD/JPY will break above 148 yen and reach a 150 yen try. There is a possibility that the market will be forced to intervene to buy the yen. However, it should be noted that there are factors smoldering that will suddenly heighten the risk-averse mood, such as the escalating trade conflict between the United States and China and concerns about slowing growth in China. Risk reversal, which is a useful reference for investigating the background of exchange rate fluctuations through market participants’ risk perception, shows that the previous period of warning against a weak yen has begun to come to an end, and it appears that we are entering a period of warning against a strong yen.
USD/JPY sell signal on slow traverse
The US dollar/yen pair continues to be firm, supported by the 21-day line, which is on an upward trend, and there is a possibility that the pair may break above 148,000 yen. If this level is exceeded, 149.695 yen (October 24, 2022), the highest return after the yen buying intervention on October 21st last year, and 150.000 yen, which is a psychological turning point, are likely to become the next cautionary levels. . However, in the stochastic with parameters (9, 3, 3), %D and Slow%D are suggesting selling, so there is concern that there will be a correction mood in the near term. If the price breaks below the daily Ichimoku conversion line of 146.157 yen (at the time of writing), there is a danger of aiming for the same standard line (144.692 yen: at the time of writing).
[USD/JPY chart daily]
Source: Gaitame.com “Gaikan Next Neo”
Expected range: USD/JPY: 144.500-149.500
Events for the week of 9/11:
9/13 (Wed) 8:50 Japan Quarterly Corporate Business Forecast Survey (BSI) for July-September period
9/13 (Wed) 8:50 Japan August Domestic Corporate Goods Price Index
9/13 (Water) 21:30 US Consumer Price Index (CPI) in August
9/14 (Thu) 8:50 Japan Machinery orders for July
9/14 (Thu) 8:50 Japan Status of foreign and domestic securities sales contracts, etc.
9/14 (Thu) 13:30 Japan July industrial production/confirmed figures
9/14 (Thu) 21:30 US August retail sales
9/14 (Thu) 21:30 US August Wholesale Price Index (PPI)
9/14 (Thu) 21:30 Number of new unemployment insurance applications in the United States
9/14 (Thu) 23:00 US July corporate inventory
9/15 (Friday) 13:30 Japan July Tertiary Industry Activity Index
9/15 (Friday) 21:30 US September New York Fed Manufacturing Industry Index
9/15 (Fri) 21:30 US August import price index
9/15 (Friday) 23:00 U.S. September University of Michigan Consumer Attitude Index, preliminary figures
short comment
Although China is trying to revive its economy through monetary easing, there are no signs of improvement. In the end, if demand does not increase even with monetary easing, growth will not accelerate. However, even if interest rates have fallen, I don’t think that easing will do anything since the supply of apartments is more than twice the total population of China.
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