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Most forex pairs seem to be stuck in ranges for now, but it looks like the dollar is pulling back from Friday’s rally.

Can this mean a bullish retracement for USD/JPY?

Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

G7 and European Union plan to ban the restart of Russia’s gas imports on routes where the country previously cut supplies

U.S. President Biden expressed hopes that the debt ceiling meeting will push through on Tuesday (May 16)

Thailand’s youth-led Move Forward Party secured an election win over the weekend, defeating the military-royalist elite that ruled the nation for over a decade

Japanese preliminary machine tool orders are down by 14.4% year-over-year, marking a slight improvement over the earlier 15.2% slump

German wholesale price index posted a 0.1% dip month-over-month in April versus a projected 0.3% uptick and earlier 0.2% gain

Swiss producer prices rose by another 0.2% month-over-month, outpacing the projected 0.1% uptick for April

Price Action News

Overlay of USD Pairs 15-min

Overlay of USD Pairs 15-min

Forex pairs are off to a bit of a slow start, following Friday’s strong dollar rally.

The Greenback is holding on to its gains against the Japanese yen, as comments from BOJ Governor Ueda over the week reiterated the need for loose monetary policy.

However, the U.S. currency has shed some of its previous gains to the commodity currencies, as market sentiment appears to have improved thanks to Thailand’s election updates.

There are no top-tier economic indicators over the next trading sessions. This gives the dollar space to carry on its correction and possibly resume its climb if debt ceiling developments turn out positive.

Upcoming Potential Catalysts on the Forex Economic Calendar:

EU economic forecasts at 9:00 am GMT
Canadian wholesale sales at 12:30 pm GMT
U.S. Empire State manufacturing index at 12:30 pm GMT
FOMC member Kashkari’s speech at 1:30 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

USD/JPY: 15-min

USD/JPY 15-min Forex Chart

USD/JPY 15-min Forex Chart by TV

A short-term pullback seems to be taking place on the 15-minute chart of USD/JPY.

The pair is retreating from its intraday highs and is closing in on the 38.2% Fibonacci retracement level that lines up with a near-term area of interest.

A larger correction could reach the 50% Fib that’s in line with a short-term rising trend line and the 135.50 minor psychological level. A much deeper pullback could reach the 61.8% Fib which coincides with the pivot point (135.33).

If any of these levels encourage dollar bulls to charge again, USD/JPY could resume the climb to the swing high at R1 (136.20).

A break below the trend line, on the other hand, could spur a move to S1 (134.85) near the swing low.