News tonight with the launch of a new intercontinental missile by North Korea, crossing the Japanese airspace, has returned the concern to the investors, at least temporarily. The initial reaction was a return to safe heavens with USDJPY correcting downside one big figure.
The market is increasingly "anesthetized" by this news and unless we see an escalation in tensions it seems that the movement is quickly corrected as seen in the European opening.
The surprise came yesterday from the Bank of England, not related with the voting of rates remaining unchanged (7 vs 2) but by the "hawkish" message of the communique pointing out that it would be appropriate to adjust interest rates in the coming months. Important movement in the GBP against the USD above the 1.34 level not seen for more than a year. The market has thus adjusted the expectations of rises assigning a probability of 100% by February 2018.
The good news came from the positive US inflation data coming out a tenth above the market consensus. Upward movement of the dollar that was quickly countered with rumors of a possible missile launch by North Korea.
Technically the USDJPY is in 110.80 / 111.00 major resistance levels not exceeded in the last month and a half whose break would open the door to levels of 111,80 / 112 and even higher.
Today the most remarkable data will come from the United States. with retail sales, industrial production and Michigan confidence. Also pending from the appearances of the ECB's Lautenschlaeger (10: 15h) and Bole Vlieghe (10: 50h)
USDJPY Daily - Ichimoku cloud running as resistance
USDJPY Weekly - last week had a bearish signal closing below the Ichimoku cloud . A close above it (111.30) would nullify this downward trend confirming a consolidation phase.
Short EURUSD 1.20 - TP 1.1650 - SL 1.21
Note: This analysis is a personal opinion based on my experience, not a professional signal service. For trading, you must base your decisions on your own criteria
