A weaker-than-expected rebound in the US durable goods orders figure released today added to the pressure around USD.
Japanese Yen is likely to stay on the back foot and underperform against USD compared to other majors as – Bank of Japan (BOJ) is expected to announce negative rates on loans, push rates further into negative territory, tweak its program. Plus, there is very little probability of a severe risk aversion before Bank of Japan rate decision is out.
Hence, JPY crosses like – EUR/JPY and GBP/JPY are likely to stay well bid heading into Fed and BOJ rate decision. Both crosses also appear strong on technical charts. Let us have a look at them one by one.
GBP/JPY Daily Chart
- Pair has already breached a smaller falling and a rebound from 160.00 followed by a break above previous day’s high of 161.80 today indicates bulls remain in control of the pair.
- Repeated exhaustion near 162.60 or failure to take out the same might result in minor correction to 160.00 levels. However, a serious fall isn’t expected ahead of Fed and BOJ.
EUR/JPY Daily Chart
- A recovery from low of 124.69 followed by a move back above has reinforced bulls and could yield 126.54 (23.6% of 141.05-122.06).