The yen against the dollar is expected to be volatile again this week (foreign exchange market analysis)
This week is a week full of remarks from Federal Reserve officials, a week of multiple central bank speeches.
In addition, with the BoE's policy rate in the UK where COVID-19 infections are spreading, volatility is expected to be very high this week.
Simply put, it is a week with daily speeches by Fed Chair Powell, and it is highly likely that price movements will aim to glean clues about the FOMC minutes.
What draws attention is Chair Powell's congressional testimony on Tuesday.
Also, at the end of the week, the release of the PCE deflator will occur, and in terms of supply and demand, the price movements will likely revolve around tapering rather than fundamentals throughout the week.
From the above, the basic recommendation is to sell retracements on the dollar majors, and even if there is a mild rebound, I believe it is a stage to refrain from counter-trend trading.
A minor rebound is likely to be completely erased by the remarks, so holding on may only be painful.
On Thursday, the Bank of England's monetary policy decision meeting is approaching.
Dollar pullback buying rarely comes at a retracement point, and a dollar selling move aiming for a return could be negated this week.
Taking a position in an area that is not clear carries high risk, and with current high volatility, I will write today's article using currency pairs with clear constituent patterns.
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