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Sagging Sentiment Sees USD/JPY Sink Off 2021 Highs

FOREX

JPY traded well, prompting USD/JPY to edge lower for the first session in five as the equity rally stalled and stock markets edged lower. Crosses including EUR/JPY and AUD/JPY saw decent momentum unwinds, but there are few signs yet of a meaningful bearish reversal.

A combination of firm US retail sales and bearish technical signals sent EUR/USD to the lowest levels of the week. Bears watch Tuesday's candle pattern for confirmation of a bearish shooting star which, if confirmed could open declines toward the 100-dma, which crossed at 1.2000 Wednesday.

Elsewhere, commodity-tied currencies slipped, with the NOK underperforming all others in G10 as oil prices were bumped lower. The WSJ reported that Saudi Arabia are to notify OPEC that they will reverse recent oil output cuts as soon as April given the recent recovery in prices. USD/NOK rallied smartly before stalling ahead of the 8.5604 50-dma.

Focus Thursday turns to weekly US jobless claims and housing starts/building permits, Australia's January jobs report and rate decisions from the Turkish and Indonesian central banks.

MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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