Currency market: USD/JPY, EUR/USD, GBP/USD and JPY correlations

Brian Twomey Brian's Investment

EUR/USD target as reported for many weeks at 1.1044 traded to 1.1026. EUR/USD above 1.0943 allowed a higher EUR/USD and near target completion. EUR/USD currently trades 1.0943 to 1.1118. Next levels 1.1000, 1.1058 and 1.1116. Note EUR/USD 1.1116 and 1.1118. EUR/USD 1.1100's represent tough to break levels.

Overall EUR/USD vital levels: 1.0853, 1.0943, 1.1118, 1.1348 and 1.1595. Only minor changes to levels will be seen over next months.

GBP/USD Vital levels for next months: 1.2568, 1.2640, 1.2744, 1.2863, 1.2892, 1.3195 and 1.3250

USD/JPY is not only oversold but big break at 140.09 is close. Break of 140.09 targets next 139.25, 138.43 and 136.77.

Long term targets for USD/JPY and JPY cross pairs remain and targets held since December / January.

The BOJ Producer Price Index reported June 12 and is expected to report again tomorrow on July 12. The intervention definitive answer is found in tomorrow's release. The revelation as suspected is no intervention. The Japanese were successful by jawboning USD/JPY a few extra pips lower. Years ago during the days of regular BOJ interventions, jawboning was always number 1 priority then came intervention.

And no intervention because Trade will report exports in Japan's favor. We will also see no words from the Japanese to USD/JPY levels.

From the Tankan Survey, the 2 most vital export currencies and most important markets for Japan are USD/JPY and EUR/JPY. Forget the Regional stuff reported as USD/JPY and EUR/JPY and Europe far outpace trade than Japan Trade with China or regional nations.

JPY correlations

USD/JPY Vs EUR/USD at last report ran Correlations at +90%. Correlation at such high levels can't hold and explains USD/JPY's move rather than the big mouth Japanese. Today's Correlations run USD/JPY Vs EUR/USD at +77% and 20 point difference. More to go which means USD/JPY must continue to separate from EUR/USD.

USD/JPY vs EUR/JPY +98% and EUR/USD Vs EUR/JPY at +85%. Correlations reveal the JPY cross pair move is just getting started and has more moves to go.

Same story to GBP/JPY as USD/JPY Vs GBP/JPY Correlate at +99% and GBP/USD correlates to GBP/JPY at +98. The GBP/JPY move has barely began its downward trajectory. Correlations alone informs to not only current price situations but what's ahead.

Author

Brian Twomey

Brian's Investment

Brian Twomey is an independent trader and a prolific writer on trading, having authored over sixty articles in Technical Analysis of Stocks & Commodities and Investopedia.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.