USD/JPY down 70 pips from the highs
You hate to see a 10-week high, which is followed by a reversal to negative territory on the day.
There are a few eccentric stories driving the movement today. The gain came during a report on the jobs that have been distorted by time, and then he came back down, in part because of concerns the data on wages have also been distorted. Then he fell on the fear of North korea’s long-range missile test.
In the end, the USD/JPY is down 15 pips on the day and maybe that is where it should be, but we must see a new high followed by a reversal of the trend. On the technical alone, it is a bad sign, but I suspect that the market will refocus on tax cuts at a certain point.
In the short term, the Fed’s Dudley is scheduled to speak on monetary policy at 1615 GMT (12:15 pm eastern time). If it reports some renewed optimism, we could be right back to the highs.
Some recent headlines from Dudley:
- Dudley: Economy may be gathering a little force
- The fundamentals of sustaining the expansion are quite favorable
- The u.s. economy is in a pretty good place