The yen is the standout currency this morning. The U.S. dollar is down 0.77% against the JPY, with USDJPY trading near 157.61. Japan’s Finance Minister Satsuki Katayama said President Trump raised concerns about yen weakness during his meeting with Prime Minister Sanae Takaichi. Katayama said Takaichi replied that an undervalued yen was problematic as a general principle.
USDJPY has also fallen back below its 200-hour moving average and 50% retracement near 158.45, followed by the swing area around 158.00. Sellers have more control while the price stays below those levels. Buyers need to reclaim 158.00 first, then 158.45, to start repairing the short-term technical picture.
The dollar is mixed but mostly lower. It is down against the EUR, JPY, GBP, AUD and NZD, while gaining against the CHF and CAD. The yen has made the strongest move against the dollar.
U.S. stock-index futures are higher, helped by lower oil prices and hopes for steadier China–U.S. relations (7:40 AM ET):
- Dow futures: up 160 points
- S&P 500 futures: up 28.12 points
- Nasdaq futures: up 200 points
Costco is a notable exception to the firmer equity tone. Its shares are lower despite fiscal fourth-quarter results that beat expectations. Earnings were $6.75 per share versus $6.54 expected, while revenue came in at $95.72 billion versus $94.97 billion expected. It is a reminder that beating estimates does not, by itself, guarantee a higher stock price: traders also weigh what was already priced in and what they expect next.
Treasury yields are mixed and little changed:
- 2-year: 4.8869%, down 0.81 basis point
- 5-year: 5.0232%, down 0.38 basis point
- 10-year: 5.1688%, up 0.68 basis point
- 30-year: 5.4671%, up 0.51 basis point
Crude oil is down 2.40% at $92.43 as traders weigh the possibility of progress between the U.S. and Iran. Iranian President Masoud Pezeshkian said Tehran wants to restore a ceasefire understanding before the November midterm elections and is open to inspections of its nuclear facilities. A phased deal under discussion would involve reopening the Strait of Hormuz and lifting the U.S. blockade. Those comments offer a possible path forward, but oil traders will be looking for concrete steps from both sides. Read more on Pezeshkian’s comments.
Gold is higher with the dollar mostly lower, while Bitcoin is up modestly.
On the North American calendar, August durable goods orders are due at 8:30 a.m. ET, followed by the final September University of Michigan consumer sentiment reading at 10:00 a.m. ET. Durable goods orders are expected to fall 0.4% after July’s 1.1% rise. The preliminary sentiment reading was 47.8 and it is expected at 47.6; traders will also watch for changes in inflation expectations which came in at 4.6% for 1 year and 3.4% for the 5 year in the preliminary report. .
In the morning video above, I take a look at EURUSD, USDJPY and GBPUSD from a technical perspective. For each pair, I outline the bias, the risk-defining levels and the targets that would give either buyers or sellers more control.
This article was written by Greg Michalowski at investinglive.com.