- Yen trade to see high volatility around BoJ meeting
- Support lies at 103.50, 102.50-00 for USDJPY
- EURSEK trending higher on weak Swedish retail data
Tonight's BoJ meeting remains the big story in the FX world, but the SEK is also worth a look as it is sinking against the euro on a poor retail sales print out of Stockholm. Photo: iStock
By John J Hardy
A look at USDJPY ahead of the BoJ meeting
The overhead resistance is quite interesting in USDJPY as the Ichimoku cloud rapidly descends into the session ahead. A post-BoJ rally would quickly cut through the cloud and could suggest a recovery to 110.00 and higher.
To the downside, the support levels come in around 103.50 and then 102.50/00 before the focus shifts all the way to the lows. Even if we do trade lower, the outlook would remain muddled due to the extent of the recent rally.
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Source: Saxo Bank
EURSEK is on the move higher again today after a weak retail sales number; we have the Q2 GDP data up tomorrow.
If we had a proper selloff in risk appetite, the upside in this pair could surprise a still-complacent market. In any case, this latest rally is putting the longer-term cyclical highs in focus above 9.600, which are not far away.
— Edited by Michael McKenna
John J Hardy is head of FX strategy at Saxo Bank