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Back-to-back testimonies from Powell and Yellen and an ADP report release means we gotta pay attention to the dollar again!

Think we’ll see explosive moves from USD/JPY?

Before moving on, ICYMI, today’s Asia-London session watchlist looked at AUD/USD possibly extending its drift lower ahead of Australia and China’s data releases. Be sure to check out if it’s still a valid play!

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

Fresh Market Headlines & Economic Data:

Australia’s AIG manufacturing PMI shrugs off Delta-related lockdown in November

New Zealand building permits drop 2% in October (-1.9% in September, +10.5% y/y)

Japan’s Q3 capex growth slows as supply constraints hit

UK retailers raise shop prices for first time since 2019 in November

AU GDP contracts by 1.9% in Q3 2021, the first contraction since Q2 2020 but better than the expected 2.7% dip

China’s manufacturing gauge slips in November on weaker demand

German retail sales unexpectedly fall for 2nd month in October

Upcoming Potential Catalysts on the Forex Economic Calendar:

U.S. ADP report at 1:15 pm GMT
Canada’s building permits at 1:30 pm GMT
Canada’s manufacturing PMI at 2:30 pm GMT
FOMC Chairman Powell and Treasury Secretary Yellen to testify in DC at 3:00 pm GMT
U.S. ISM manufacturing PMI at 3:00 pm GMT

If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.

What to Watch: USD/JPY

USD/JPY 1-hour Forex Chart
USD/JPY 1-hour Forex Chart

Just yesterday we looked at USD/JPY’s Fib retracement levels before Powell and Yellen first took center stage this week.

Since then, the dollar has revisited its November lows but has also bounced back to near the 113.50 levels.

Will USD/JPY maintain its bearish trend in the next trading session?

Uncle Sam is printing its ADP report and, if market expectations are right, then we could see a slight dip from last month’s numbers.

Surprisingly weak ADP data, or Powell qualifying his comments on the Fed discussing tapering early could drag USD/JPY back to its 112.75 lows.

A bit of risk-taking, on the other hand, or focus on the dollar and the Fed’s taper timeline could lift USD/JPY back to the 114.00 levels closer to the middle of the 1-hour range.

What do you think? Will USD/JPY continue its bearish tilt? Or will the dollar regain its ground against the yen and revisit its 114.00 and 115.00 highs?