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Yen Slumps on BoJ31 July 2018 by Dave Evans

Morning Report: 07.00 London

The Japanese yen is struggling after the BoJ opted to keep rates on hold against an outside chance of easing moving to an end. Instead, the BoJ announced that headline interest rates were likely to remain at historic lows for the foreseeable future. The USD/JPY has risen, though the weak dollar is putting a lid on gains.

The EUR/JPY is set for another solid day higher after gains yesterday. The GBP/JPY is rallying above 146.00 The star of the day is the AUD/JPY which has risen above 82.50.

Dollar pairs are following suit, with the AUD/USD lifting for the third straight day. The EUR/USD is still range bound, but is set for another positive day, with the range high of 1.1800 in sight. The GBP/USD is struggling however with small gains since Thursday’s slump.

The EUR/GBP is rallying for the third straight day and is within a day’s session of last week’s high of 0.8950.

The Swiss franc continues to strengthen as a safe haven of choice, forcing the USD/CHF lower again. By contrast, the EUR/CHF downswing remains in force, with the pair struggling to reverse the negative momentum.

Coming up today

Today we have CPI flash estimates from Europe at 10.00.

At 13.30, we have Canadian GDP and RMPI.

US core PCE price index is also at 13.30, with employment cost index and personal spending also at the same time.

Chicago PMI is at 14.45, with US consumer confidence at 15.00.

Trade Idea

The Swiss franc is in demand and in vogue as a safe haven, forcing the EUR/CHF lower, but there could be lower levels to come.

July 31st, 2018: Yen Slumps on BoJ

A good way to play this is a LOWER trade predicting that the EUR/CHF closes below 1.1550 in 14 days for a potential return of 129%.

July 31st, 2018: Yen Slumps on BoJ