Welcome to Extreme Investor Network, where we provide you with unique insights and analysis on the latest news and trends in the stock market. Today, we are focusing on key economic indicators and events that could impact the USD/JPY currency pair in the coming days.
Economists are forecasting a slight decline in the Jibun Bank Services PMI for May, which could signal a slowdown in the Japanese services sector. However, it is important for investors to delve deeper into the sub-components of the report, such as input prices, employment trends, and new orders, to get a comprehensive view of the economic landscape.
In addition, inflation figures for Japan are slated to be released on May 24. A softer-than-expected inflation rate could keep the Bank of Japan on hold and impact the demand for the Yen. Investors should keep a close eye on these numbers to gauge the potential market impact.
Turning our attention to the US economic calendar, key events such as the release of existing home sales data and preliminary private sector PMIs will be closely watched. These figures could have implications on investor sentiment towards a possible Fed rate cut in the coming months.
Furthermore, the finalized Michigan survey and core durable goods data will be released on May 24, providing further insights into consumer sentiment and inflation expectations. Any revisions to the preliminary figures could sway market sentiment and impact the USD/JPY currency pair.
In the short term, USD/JPY price action will be influenced by central bank commentary, Services PMIs, and inflation numbers from Japan. A higher-than-expected US Services PMI and hawkish Fed chatter could favor the US dollar, while Q1 GDP numbers from Japan could limit the options for the Bank of Japan.
On the technical side, the USD/JPY remains above key moving averages, suggesting a bullish outlook. A move towards the 158 handle could set the stage for a further rally towards the April 29 high of 160.209. However, a break below the 50-day EMA could signal a decline towards the 151.685 support level.
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