dollar index has been fluctuating and consolidating after hitting its annual high in the past week and hitting its highest level since December 2002. The US dollar's pullback is synchronized with the probability of the Federal Reserve raising interest rates in recent days and the decline in US bond interest rates. Considering that these two factors drive the US dollar to rise rapidly in 2022, it is not surprising that it has seen a synchronous decline.
In particular, the probability of the Federal Reserve raising interest rates and the decline in US bond interest rates have the most direct impact on the US dollar against the Japanese yen. After reaching the highest level since October 1998, the US dollar fell against the Japanese yen. But the policy path differences between the Federal Reserve and the Bank of Japan are still obvious and may expand further in the coming months. The short-term pullback of the US dollar against the yen may soon lay the groundwork for the "buy on dips" opportunity.
html On June 23, the US dollar against the Japanese yen reached its highest level since October 1998, so the decline in the past two days may not necessarily affect the overall exchange rate trend. But if the probability of a Fed rate hike continues to fall along with U.S. Treasury bond interest rates, the dollar may be under greater downward pressure against the yen before restarting its gains. If the uptrend in the past three weeks is to maintain its current speed, this should be the key turning point level. "The idea of 'buy on dips' in the short term is appropriate."
According to the IG customer sentiment index, nearly 24.12% of customers are net longs, and the ratio of net shorts to net longs is 3.15:1. The number of net longs fell 8.67% from yesterday and 8.67% from last week. The number of net short sellers fell 7.89% from yesterday and 1.63% from last week.
Given that the IG sentiment index is usually used as a reverse indicator, most retail investors hold net shorts that suggest the US dollar may rise against the yen. The intraday net short positions increased compared with yesterday but decreased compared with last week. Combined with current retail sentiment and the latest changes in holdings, the outlook for the US dollar against the Japanese yen is more neutral.
Tianyan reminder: Before doing foreign exchange transactions, you must review the qualifications of the foreign exchange platform and the official website information to prevent being deceived. If you encounter foreign exchange withdrawal problems or fraud, you should immediately collect evidence and report to the police, and expose and protect your rights!
