USDJPY tumbles after the weak US data

The USDJPY USD/JPY The USD/JPY is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Japanese yen of Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed in order to purchase one US dollar. For example, when the USD/JPY is trading at 100.00, it means 1 US dollar is equivalent to 100 Japanese yen. The US dollar (USD) is the world’s most traded currency, whilst the Japanese yen is the world’s third most traded currency, resulting The USD/JPY is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Japanese yen of Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed in order to purchase one US dollar. For example, when the USD/JPY is trading at 100.00, it means 1 US dollar is equivalent to 100 Japanese yen. The US dollar (USD) is the world’s most traded currency, whilst the Japanese yen is the world’s third most traded currency, resulting Read this Term is moving sharply lower after flash PMI data, US new home sales, and Richmond Fed manufacturing indices all shocked the markets with lower values.

Of particular focuses is the sharp fall in new home sales. The shoe dropped hard in the real estate market as inventory rose to a 9 month level (from 6 months last month). The higher mortgage rates have increased monthly payments by over $450 since beginning of the year on the average price. That is pricing buyers out of the market.

The silver lining (maybe) is yields are sharply lower as markets price in the expectations that the Fed may have to taper their tightenings earlier than expected.

Looking at the USDJPY, it has moved down to test the 50% midpoint of the last trend move higher from the end of March corrective low. That level comes in at 126.306 (see daily chart above. The low price just reached 126.38.

Looking at the hourly chart below, the 50% level corresponds with swing levels going back to mid April before the price shot higher on April 18 and April 19. A move below that level would open the door for a rotation back down toward the 61.8% retracement at 125.14.

Looking at the US treasuries US Treasuries US Treasuries represent securities in the form of government debt instruments issued by the United States Department of the Treasury to finance government spending as an alternative to taxation. US Treasuries actually comprise four different types of marketable treasury securities. This includes Treasury bills, Treasury notes, Treasury bonds, and Treasury Inflation Protected Securities (TIPS). The US government sells these securities in auctions conducted by the Federal Reserve Bank of New York, US Treasuries represent securities in the form of government debt instruments issued by the United States Department of the Treasury to finance government spending as an alternative to taxation. US Treasuries actually comprise four different types of marketable treasury securities. This includes Treasury bills, Treasury notes, Treasury bonds, and Treasury Inflation Protected Securities (TIPS). The US government sells these securities in auctions conducted by the Federal Reserve Bank of New York, Read this Term:

• 2 year yield 2.485, -14.0 basis points
• 5 year yield 2.73, -13 point basis points
• 10 year 2.736, -12.0 basis points
• 30 year 2.964, -9.2 basis points

Looking at the daily chart of the 10 year, the yield is down to the lowest level since April to 27th when the yield moved to 2.717%. The low yield today has reached 2.733% so far. The yield is down from a high reached on May 9 at 3.203%.