After bottoming out at 129.65 on March 24, the dollar/yen exchange rate rose to 134.57 yesterday (the highest level in about a month since March 15). During this period, the daily chart and candlestick chart broke through the major technical points, and the “uptrend of the Dow theory”, which suggests a strong buy signal, was also established. is on the rise. However, it should be noted that the upper limit of the Ichimoku Kinko cloud, which is considered to be a strong resistance, is just above the daily candlesticks. If the market fails to break through the same level, we can expect a scenario in which disappointing selling will spread, especially among short-term investors.
On the other hand, from a fundamental perspective,
(1) the US Fed is expected to end monetary tightening (the US CPI and US PPI announced last week both indicated a slowdown; However, the fact that the US Fed is in the final phase of the monetary tightening cycle and is expected to cut interest rates by the end of the year remains unchanged) and ,
(2) Revised expectations for monetary easing by the Bank of Japan.
(3) Differences in the direction of monetary policy between Japan and the United States against the background of 1 and 2 above;
(4) Concern about the backflow of speculative money. The muscle position has recorded “US dollar long against all currencies” for the first time since January 2022 →Beware of the reversal risk of US dollar long as the position bias is remarkable), which is reminiscent of a decline in the dollar-yen exchange rate.
Based on the above, we continue to forecast a reversal of the dollar-yen exchange rate as the main scenario (assuming a scenario in which weak fundamentals hinder continued growth). Today, we will be looking at China’s major economic indicators (China’s January-March GDP statistics, China’s retail sales in March, industrial production in China in March, fixed asset investment in China in March), housing starts in March in the United States, Attention will be focused on the number of construction permits received in March and Bowman’s speech by FRB Director.
Today’s expected range: 133.50-135.00