Japanese yen retreats after dovish BOJ decision
The Australian dollar was little changed in the Asian session after relatively positive economic numbers from China. According to the government, the country’s industrial profit jumped by 92.30% year-on-year in March after rising by 20.10% in the previous month. Year-to-date, industrial profits rose by 137% after rising by 178.9% in February. Recent numbers have shown that the Chinese economy is firing on all cylinders. Its exports and imports have swelled while the unemployment rate has declined. Analysts expect that the economy continued to expand rapidly in the first quarter.
The Japanese yen eased slightly against the US dollar after the April Bank of Japan (BOJ) decision. As expected, the bank left the interest rate unchanged even as it remained cautious about the future. The bank also acknowledged that the rate of inflation will not reach the 2% target in the near term. Further, the BOJ left its asset purchases unchanged. The decision came two days after the government announced a state of emergency in Tokyo and Osaka as the number of coronavirus cases rose. The BOJ decision came a day before the Federal Reserve is set to publish its decision.
US index futures continued the upward trend as the market waits for key corporate earnings. Futures linked to the Dow Jones and S&P 500 are up by 17 and 5 points, respectively. Some of the most notable companies that will publish their results today are Microsoft, Alphabet, Visa, Novartis, Eli Lily, Texas Instruments, UPS, and Amgen. In general, the ongoing earnings season has been relatively strong, with more than 70% of companies reporting better-than-expected earnings.
The EUR/USD pair declined to an intraday low of 1.2068, which is lower than this year’s high of 1.2115. On the hourly chart, the pair has moved below the upper side of the ascending channel that is shown in pink. It is also slightly below the 25-day and 15-day moving average while the Relative Strength Index (RSI) and MACD have continued to drop. The pair may keep falling as bears target the lower side of the channel at 1.2040.
After weeks of back to back declines, the USD/JPY pair turned around in the overnight session. It moved from an intraday low of 107.43 to 108.38. On the four-hour chart, the pair has even moved above the 25-day and 15-day moving averages (MA) while the MACD and the Awesome Oscillator have moved above the neutral line. Therefore, the pair may continue having the relief rally and then resume the previous downward trend in the near term.
ETH/USD is still bouncing back after the major sell-off last week. It is trading at 2,522, which is slightly below its all-time high. On the four-hour chart, the price is slightly above the 25-day moving average. It has also formed a V-shaped pattern while the DeMarker indicator has moved close to the oversold level. The pair may keep rising as the overall momentum increases.