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USD index analysis and possible effect on USD/JPY | Oct 4, 2022

Updated: Oct 5, 2022

After a weaker than forecasted Pending Home Sales (-2.0% vs -0.9% is weaker despite positive revision in previous release from -1.0% to -0.6%), Revised UoM Consumer Sentiment (58.6 vs 59.5) and IMS Manufacturing PMI (50.9 vs 52.5); a weaker than forecast JOLTS Jobs Opening data (11.05M vs 11.07M along with negative revision in previous release from 11.24M to 11.17M) can be an initial sign of economic slowdown in the US.

A weaker than forecasted ADP NFP (Automatic Data Processing - Non-Farm Payroll) and NFP this week may exacerbate the slowdown. Alternatively, a stronger than forecasted NFP can boost the USD-index back to its recent high.

Having made a 20-year high and an overbought scenario on RSI, USD-index returned below MACD predictor. It technically shows a beginning of downward correction trend. A weaker than forecasted NFP can add fuel to it.

Since BOJ has already been financially and verbally intervening in the Forex market to push USD/JPY lower, a poor labor market condition in the US can help USD/JPY fall.

Please note that Keon Consultancy uses these ideas in Forex Account Management / Fund Management; however, it doesn't post all the ideas used in trading.

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1 Comment

Here is how economic slowdown began in the US, and how it may be aggravated. 👆🏻

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