Forex

Risk sentiment has taken the driver’s seat for USD/JPY, but this week’s barrage of top-tier U.S. data and BOJ guidance may hand the reins back to fundamentals.

The commitment of traders (COT) report shows how large speculators are positioned across futures markets on the CME exchange.

RBA cash rate futures currently imply a 62% chance of an RBA cut in May, and those odds are likely to increase further should trimmed mean inflation dip to 3% y/y or lower.

Sticky inflation in Japan’s capital keeps pressure on the BOJ to normalise policy, but uncertainty around U.S. tariffs and global growth is forcing caution. Despite the hot data, USD/JPY remains a risk appetite trade for now.

Over the past two trading sessions, the USD/CAD pair has posted a slight gain of 0.5% in favor of the U.S. dollar, although the overall bias remains bearish due to the greenback’s continued weakness in recent weeks.

Traders may be able to use USD/CNH as a potential signal into the CCP’s outlook toward the ongoing trade tensions - see how!

A stalled recovery in the Aussie and Kiwi is raising fresh questions over whether recent gains have legs. With bearish candles emerging and the US dollar back in demand, the path of least resistance may be lower—at least for now.

USD/JPY has fallen around 12% from its January high, but with several key levels of support nearby I am inclined to suspect this phase of the decline is much closer to the end than the beginning. CAD/JPY has formed a double bottom around a key support level, and AUD/JPY looks set to extend gains (over the near term).

Traders are increasingly focused on what a Trump-aligned Fed might mean for policy, inflation, and the dollar. With the risk of unconventional policies back in the mix, the greenback’s downside could extend if deemed a policy error by markets.

Over the past five trading sessions, EUR/USD has shown consistent strength, climbing more than 2% and successfully breaking through the psychological 1.15000 level, while the U.S. dollar continues to weaken in the short term.

USD/JPY continues to shrug off traditional drivers like yield spreads and Fed pricing, aligning more closely with classic safe havens like gold and Swiss franc. Unless that dynamic breaks, trade headlines and Treasury auctions may prove more influential than central bank speech or second-tier data releases in the week ahead.