Japan’s Tokyo CPI rates due out tomorrow.

In tomorrow’s Asian session Japan’s Tokyo CPI rates for September are to be released. The Tokyo Core CPI rate is currently anticipated by economists to come in at 2.8% which would mark an acceleration of inflationary pressures in the Japanese economy, considering that the prior rate was 2.5%. Hence should the Tokyo CPI rates come in as expected it may provide support for the JPY as calls for the BOJ to resume on their rate hiking path may increase. Moreover in our view, an acceleration of inflationary pressures could open the door for policymakers to adopt a more hawkish tone which could further aid the Yen.In the US, the durable good’s order rates for August is due out in today’s American trading session as is expected to showcase an improvement. In turn, should the rate come in as expected or higher it may provide support for the dollar. However, we should also note the flurry of Fed policymakers who are set to speak today, notably Chicago Fed President Goolsbee, New York Fed President Williams and Fed Board Governor Bowman, whose comments could potentially dictate the dollar’s direction for the day.In the US Equities markets, Bloomberg has reported that Intel is seeking an investment from Apple with the two companies having “discussed how to work more closely together, said the people, who asked to not be identified because the deliberations are private”, per Bloomberg. The rumors about a possible collaboration between the two companies could provide support for Intel’s (#INTC) stock price in today’s trading session.

USD/JPY appears to be moving in an upwards fashion, after clearing our sideways moving channel which was incepted on the 11th of July, in addition to clearing our resistance now turned to support at the 148.50 (S1) level. We opt for a bullish outlook for the pair and supporting our case are the aforementioned factors in addition to the RSI indicator below our chart which currently registers a figure near 60, implying a bullish market sentiment. For our bullish outlook to be maintained we would require the pair to remain above our 148.50 (S1) support level if not also clearing our 150.75 (R1) resistance line with the next possible target for the bulls being the 153.35 (R2) resistance level. However, in the event of a clear break below our 148.50 (S1) support level we would opt for a bearish outlook for the pair with the next possible target for the bears being our 146.25 (S2) support line. Lastly, for a sideways bias we would require the pair to remain confined between our 148.50 (S1) support level and our 150.75 (R1) resistance line.

XAU/USD appears to be facing resistance at our 3740 (R1) level at the time of this report. Considering that the RSI indicator below our chart tends to imply that the commodity is overbought, we would not be surprised to see a temporary retracement to lower ground. However, we opt for a predominantly bullish outlook for the precious metal’s price and supporting our case is the MACD indicator below our chart. For our bullish outlook to be maintained we would require a clear break above our 3740 (R1) resistance line, as well as a clearing of the recently formed all-time high figure, with the next possible target for the bulls being the 3860 (R2) resistance level. On the other hand, for a sideways bias we would require gold’s price to remain confined between our 3620 (S1) support level and our 3740 (R1) resistance line. Lastly, for a bearish outlook we would require a clear break below our 3620 (S1) support line with the next possible target for the bears being the 3500 (S2) support level.

Other highlights for the day:

Today we note the release of Germany’s Gfk consumer sentiment, the UK’s CBI distributive trades figure, the US Durable Goods orders rate for August, the US Final GDP rate for Q1, the US weekly initial jobless claims figure and the US existing home sales figure for August. In tomorrow’s Asian session, we note Japan’s Tokyo CPI rates for September. On a monetary level we note the speech by ECB Kazimir, the SNB’s interest rate decision and the speeches from the following policymakers, Chicago Fed President Goolsbee, New York Fed President Williams, Kansas City Fed President Schmid, Fed Governor Bowman and San Francisco Fed President Daly.

USD/JPY  Daily Chart

• Support: 148.50  (S1), 146.25 (S2),  144.35 (S3)
• Resistance: 150.75  (R1), 153.35 (R2),  155.60 (R3)

XAU/USD  Daily Chart

• Support:  3620 (S1), 3500 (S2), 3385 (S3)
• Resistance:  3740 (R1), 3860 (R2), 3980 (R3)

If you have any general queries or comments relating to this article please send an email directly to our Research team at research_team@ironfx.com

Disclaimer:
This information is not considered as investment advice or an investment recommendation, but instead a marketing communication. IronFX is not responsible for any data or information provided by third parties referenced, or hyperlinked, in this communication.

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