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The Japanese yen is declining against the US dollar for the seventh consecutive session. The USDJPY pair is approaching the 156.40 mark.

Japan’s government is poised for close cooperation with the Bank of Japan on currency market issues. This is needed to avoid disagreements on the goals of the policies they pursue, stated Shunichi Suzuki, the minister of finance, today. He noted that the Ministry of Finance is closely monitoring the currency and taking all possible measures. It is important to the authorities that the yen’s exchange rate remains stable and reflects fundamental indicators.

However, Suzuki did not communicate any specific exchange rate values. He also hardly said anything about financial interventions conducted in late April and early May to support the yen.

After falling earlier to 160.00 per US dollar, the yen has steadily risen. However, it expectedly came under pressure again now. Currency interventions have an intermittent impact and cannot create conditions for a fundamental change in the currency market environment.
The Japanese authorities are also concerned about the interest rate issue. Although no significant changes in the monetary policy structure are expected now, the market closely monitors this issue.

USD/JPY Technical Analysis

The USDJPY pair has completed a corrective wave on the H4 chart, reaching 156.16. Today, a consolidation range is forming around this level. The price is expected to break below it and continue the third decline wave, aiming for 151.40. After the price reaches this level, a correction towards 154.00 could start, followed by a decline to 149.00. Technically, this scenario is confirmed by the MACD oscillator, with its signal line above the zero level, poised to decline to new lows.

On the H1 chart, the USDJPY pair has completed a growth wave at 156.16, with a narrow consolidation range formed around this level. Today, the price attempts to break above it, aiming for 156.66. The range extension towards 156.81 is not ruled out. It is worth noting that all growth structures are only perceived as the extension of this wave, with the market able to continue a downtrend at any moment. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line above 80, poised to move to new lows.

The British pound has posted slight losses on Tuesday. GBP/USD is down 0.08%, trading at 1.2548 in the European session at the time of writing.

UK job growth slides

The UK labor market continues to show cracks as job growth was sharply lower in today’s employment report. The economy shed 178,000 jobs in the three months to March, after losing 156,000 in the previous report. This was better than the market estimate of a decline of 215,000. The unemployment rate rose to 4.3%, up from 4.2% and matching the market estimate. Wage growth ticked up to 5.7%, compared to the revised 5.6% gain in the previous report.

The job report points to weakness in job growth and higher unemployment, which will support the BoE cutting rates. That could come as soon as June, with the markets pricing in a 50% chance of a June cut. After the report, BoE Chief Economist Huw Pill said that it was “not unreasonable” to expect the central bank to consider lowering rates.

The BoE is eyeing a June cut, but will want to see that inflation continues to downtrend towards the 2% target. That means that next week’s inflation report will be a key factor in the rate decision.
Inflation, inflation, inflation. That is what the Fed is focused on and the US releases the Producer Price index today and CPI on Wednesday. PPI is expected to remain unchanged at 2.4% in April while CPI is projected to ease to 3.6%, down from 3.8% in April. The Fed has delayed plans to cut rates but a drop in this week’s inflation releases would boost the likelihood of a rate cut in September.

GBP/USD Technical

• GBP/USD is testing support at 1.2547. Below, there is support at 1.2526
• 1.2581and 1.2602 are the next resistance lines

Hello fellow traders. In this technical article we’re going to take a quick look at the Elliott Wave charts of Dollar Index, published in members area of the website. As our members know, USDX has ended the cycle from the December’s 2023 low. The index has recently given us bounce in a 3-wave pattern, when sellers appeared right at the equal legs zone. Let’s break down our Elliott Wave forecast further in this article.

USDX H1 Asia Update 05.08.2024

The current view suggests that Dollar Index is doing a ((iv)) recovery, which is correcting the cycle from the 106.48 peak. Proposed recovery can be unfolding as a Elliott Wave Zig Zag Pattern .The price is reaching important technical area at 105.46-105.86. We expect potential sellers to appear in this area, which could lead to a further decline towards new lows or a three-wave pull back at least.

USDX H1 Asia Update 05.14.2024

USDX has found sellers as expected and made a nice bounce from the Equal Legs zone. We consider the wave ((iv)) correction completed at the 105.759 high. CWe would like to see break of previous ((iii)) black low as confirmation wave ((v)) is in progress. We advise against buying Dollar in during any suggested bounce and favor the short side.

Market picture

Crypto market capitalisation rose 0.8% over the past 24 hours to 2.2 trillion, but growth exceeded 2% for most of the period. However, it dipped at the start of active European trading, temporarily returning to levels of a day ago.

Bitcoin has added 0.9% over the past 24 hours, while Ethereum has increased by 0.15%. The top coins show dynamics from falling by 1% (BNB) and 0.8% (TON) to growth by 7.3% (DOGE) and 4.2% (SOL).

Bitcoin reversed on Monday on its approach to the $63.0K level, just below the pivot area on Friday, continuing a series of lower local highs. This time, it was at a significant distance from the 50-day moving average.

However, the pattern is even more negative in Ethereum, where the price has pulled back to the lower end of the range of the last three months, near $2900, drawing a bearish triangle. Technically, breaking this support opens the way to $1600-1500. This sounds like an overly negative scenario, and in our opinion, it is worth being prepared that Ethereum could attract enough buyers already on a dip into the $2500-2700 area.

News background

According to CoinShares, investments in crypto funds rose by $130 million last week after four weeks of outflows. Bitcoin investments increased by $144 million, Solana investments increased by $6 million, and Ethereum investments decreased by $14 million.

Trading volumes fell to $8bn last week, down from an average of $17bn in April. Low engagement by US regulators with issuers’ applications for spot Ethereum-ETFs has increased speculation that ETF approval is not imminent, reflected in outflows from Ethereum, CoinShares noted.

The end of the consolidation is not far off. Traders have shown little interest in Bitcoin’s latest pullback. In general, the lack of such faith from the crowd acts as a strong sign that prices are close to the bottom, suggests Santiment.

Bitcoin’s bull cycle is just beginning, and BTC will be worth at least $117,000 in August 2025, Pantera Capital expects.

“Dormant” for more than ten years, 1,000 bitcoins have now started to move, Lookonchain pointed out. According to Chainalysis, 1.75 million Bitcoin wallets have been inactive for more than ten years. They hold 1.8 million BTC, which is 8.5 per cent of the total issuance.

The US government is going after Tether as potential regulatory action could have significant implications for the industry, Ripple CEO Brad Garlinghouse said. In response, Tether’s CEO accused the head of Ripple of spreading damaging rumours.

Uniswap called the “all-out war” on cryptocurrencies waged by the SEC and Senator Elizabeth Warren a miscalculation by the Biden administration that could cause him to lose the upcoming US presidential election.

German ZEW Economic Sentiment jumped from 42.9 to 47.1 in May, above expectation of 44.9. Current Situation Index also rose from -79.2 to -72.3, above expectation of -75.0.

Eurozone ZEW Economic Sentiment rose from 43.9 to 47.0, above expectation of 46.1. Current Situation Index jumped by 10.2 pts to -38.6.

ZEW President Professor Achim Wambach said: " Signs of an economic recovery are growing, bolstered by better assessments of the overall eurozone and of China as a key export market. The increased optimism is reflected in particular in the sharp rise in expectations for domestic consumption, followed by the construction and machinery sectors."

Full German ZEW release here.

BoE's Chief Economist Huw Pill suggested today that it is "not unreasonable" for central bank to consider rate cuts over the summer. However, he emphasized the critical need for to maintain a "restrictive stance" on monetary policy to address persistent domestic inflation pressures.

Pill's comments come against the backdrop of newly released data, which he referenced in his remarks. "We actually got some additional data this morning that would be consistent with a small additional decline in the first quarter," he said, pointing to the latest figures on private sector regular pay growth.

This data indicates a slight cooling in the labor market, although Pill noted that it "still remains pretty tight by historical standards." He emphasized that "rates of pay growth remain quite well above what would be consistent for meeting the 2% inflation target sustainably."

• EURJPY in the green for the seventh consecutive trading day
• Bulls aim for April’s multi-year highs, but they might run out of steam soon

For the past week, EURJPY has been experiencing a non-stop upward movement, currently targeting April’s bar of 169.27, which proved tough to claim despite the flash spike to a 40-year high of 171.56.

Having jumped back above January’s upward-sloping channel, the pair might retain buying interest in the coming sessions. The technical indicators confirm this narrative as the RSI continues to trend up and is still below the overbought level of 70. Yet, with the stochastic oscillator looking for a bearish turn above its 80 overbought level, the market might struggle to repeat its recent success.

Surpassing the 170.00 level decisively could pave the way for reaching the 40-year high of 171.56 or establishing a new higher high within the 172.25-172.70 trendline area. Beyond the latter, the rally might expand towards the 175.00 round level or up to the 161.8% Fibonacci extension of the previous downleg at 176.23.

On the downside, a step below the 167.25-167.95 area, where the 23.6% Fibonacci retracement of the November-April upleg is placed, could initially halt near the 20-day simple moving average (SMA) at 166.45. If selling forces persist, the price might retest the 50-day SMA and the lower boundary of the bullish formation within the 164.00-164.60 region. Note that the 38.2% Fibonacci number is in the neighborhood. Hence, failure to pivot there could cause a sharper decline towards the 50% Fibonacci of 162.35.

In a nutshell, EURJPY bulls might stay in charge in the coming sessions, but their ability to successfully surpass the 169.27-17.00 constraining territory remains uncertain.

• GBPUSD looks neutral in very short-term
• A jump above 1.2630 could add some optimism
• Stochastic and MACD are mixed

GBPUSD has successfully jumped above the 200-day simple moving average (SMA) with the next crucial obstacle coming from the short-term downtrend line and the 50-day SMA around 1.2590.

Technically, the MACD oscillator is still developing with weak momentum above its trigger line and below the zero level, while the stochastic is extending its upside movement towards the overbought region after the bullish crossover within its %K and %D lines.

If the market overcomes the diagonal line, immediate resistance could be faced from the 1.2630 barricade ahead of a test of the 1.2708 mark. However, the broader outlook would shift to a more neutral one as only a break above the six-month high of 1.2892 could switch the bias to bullish.

On the other hand, a break beneath the 1.2465 support level could endorse the short-term bearish movement, meeting the five-month low of 1.2300. Steeper decreases could turn traders’ attention towards the 1.2186 bottom.

Summarizing, GBPUSD has been moving sideways since April 25 as it is holding within the SMAs, and a move above the downtrend line could change the broader picture to neutral too.

Short Term Elliott Wave in DAX suggests that the Index ended wave (4) pullback at 17626.54. From there, it rallies higher in wave (5) as a nesting impulse Elliott Wave structure. Up from wave (4), wave ((i)) ended at 18226.32 and dips in wave ((ii)) ended at 17795.96. The Index then nested higher within wave ((iii)). Up from wave ((ii)), wave (i) ended at 18235.80 and pullback in wave (ii) ended at 17875.98. Wave (iii) higher ended at 18845.86 and wave (iv) pullback is proposed complete at 18706.08.

Expect the Index to rally higher in wave (v) to complete wave ((iii)). Potential target for wave (v) is 123.6 – 161.8% external retracement of wave (iv). This area comes at 18877 – 18930. Afterwards, it should pullback in wave ((iv)) to correct cycle from 4.25.2024 low before another high again in wave ((v)) to end wave 1. Then it should do a larger degree correction in wave 2 to correct cycle from 4.19.2024 low before it resumes higher. Near term, as far as pivot at 17626.54 low stays intact, expect any pullback to find support in 3, 7, 11 swing for further upside.

DAX 60 Minutes Elliott Wave Chart

DAX Elliott Wave Video

https://www.youtube.com/watch?v=ZBKnW35ypxs

Daily Pivots: (S1) 195.21; (P) 195.75; (R1) 196.74; More...

Intraday bias in GBP/JPY stays on the upside at this point. Rebound from 191.34 is seen as the second leg of the corrective pattern from 200.53, and could target 197.40 resistance. On the downside, break of 194.74 minor support will turn intraday bias neutral first.

In the bigger picture, a medium term top could be in place at 200.53 after breaching 199.80 long term fibonacci level. As long as 55 W EMA (now at 183.41) holds, fall from there is seen as correcting the rise from 178.32 only. However, sustained break of 55 W EMA will argue that larger scale correction is underway and target 178.32 support.