A lack of bigger potential catalysts around the world can put the spotlight on Japan’s economic releases this week.
Which market themes should you pay attention to?
I’ve got a list right here!
Mid-tier data releases
- Japan’s economic recovery slows as pandemic pain lingers
- Final industrial production (Feb 15, 4:30 am GMT) seen at -3.2% vs. -3.9% initial reading
- Core machinery orders (Feb 16, 11:50 pm GMT) to drop by 4.0% (from +1.5%), with annual figures hitting -5.0% (from -11.3%)
- Trade balance (Feb 16, 11:50 pm GMT) to show a 430B JPY deficit (from 751B JPY surplus) even as exports outpace imports
- Inflation rate (Feb 18, 11:30 pm GMT) to print at -1.0% (from -1.2%)
- Jibun’s manufacturing PMI (Feb 19, 12:30 am GMT) seen improving from 49.8 to 50.0
Overall risk appetite
- Increased vaccination and stimulus hopes from around the world could continue to weigh on the safe-haven yen
- USD/JPY remains sensitive to U.S. Treasury yields action
- Fed and ECB events, as well as PMI releases from major economies, could expose the yen to countercurrency volatility
Technical snapshot
- Stochastic is flagging the yen’s “oversold” conditions against almost all of its major counterparts
- USD/JPY remains in the neutral area on the daily
- Moving averages reflect the yen’s short and long-term bearish trends across the board
- JPY is still above the long-term 200 EMA but shorter-term averages suggest bearish pressure
- The yen was most volatile against the comdolls and the pound in the last seven days
