The US attack on Iran was delayed for two weeks, which made the market feel calm for a short time. Because of this, the rise in the US dollar stopped. However, people continued selling Japanese yen against the euro and the pound. As a result, USD/JPY rose above the top of the Ichimoku cloud and stayed around 145 yen.
Trade talks about tariffs between Japan and the US are still difficult, so the trend of selling yen and buying dollars may continue this week.
But now that the US finally attacked Iran, the market may become unstable again at the start of this week. After the shock goes away, traders may focus again on the interest rates of the US and Japan.
If Tokyo’s June inflation data shows strong inflation, people may buy yen. Also, the US June PCE inflation report is important. If this report, like the recent CPI and PPI reports, shows weak inflation, people may sell dollars. After the FOMC meeting last week, President Trump again asked Fed Chair Powell to lower interest rates by 2.5%. Powell ignored this, but in the end, the Fed may cut rates sooner than planned. So, traders will watch carefully if Powell says anything new this week.
However, the risk from the Iran conflict is still high, and the dollar may keep going up against the yen.
Today’s USD/JPY expected range: 145.60 – 146.50
This week’s USD/JPY expected range: 144.30 – 147.20
Note: This information does not guarantee profits. Please make your own decisions when trading.