Yesterday the USDJPY traded without clear direction in the upper 147-yen range during Tokyo hours. The June Consumer Price Index (CPI) released at GMT 12:30 showed strong results, causing the USDJPY to break above the May high and reach a peak of 149.02 yen at around GMT 15:30. Trading for the day closed at 148.84 yen.

Today the USDJPY broke above consolidation around 149.0 yen and hit a high of 149.18 yen shortly after GMT 04:00. The June CPI data has pushed back expectations for rate cuts this year, with dollar buying momentum continuing.

Looking at the 1-hour chart of the USDJPY (as of GMT 04:30 on July 16), the width of the Bollinger Bands has expanded and the pair is maintaining a solid foundation. Having broken through recent resistance levels, the next upside target appears to be around 149.5 yen.

(20-period Bollinger Band, showing ±1 and ±2 standard deviations)

The main economic indicators for today are as follows:

• GMT 12:30 U.S. June Producer Price Index (PPI)
• GMT 12:30 U.S. June Producer Price Index (core PPI excluding food and energy)