June 17 – June 21: Total trades resulted in a loss of 91,776 USD.
This week, significant losses were incurred due to fluctuations in the British pound. The volatility of our earnings has been too high recently, so starting next week, we’ll focus solely on EUR/USD and USD/JPY to be more cautious in our entries.
Future Considerations
1. Potential Yen Buy Intervention Resumption
The risk of yen buy interventions by the Japanese government and Bank of Japan remains, even though the U.S. has added Japan to its currency manipulation “watch list.” The yen’s depreciation has increased concerns among Japanese officials. Despite the watch list addition, intervention to defend the yen is still possible.
2. Biden-Trump Debate
The upcoming debate between President Biden and former President Trump on June 27 will focus on policies regarding Ukraine, the Middle East, and China. Trump’s potential rise in popularity may increase geopolitical risks in Europe, affecting currency markets. Should Trump gain favor, USD might see some depreciation due to his “America First” stance.
Currency Focus
USD The market is pricing in two rate cuts by the Fed this year, which may cap the dollar’s gains. Key events include the Biden-Trump debate and European Parliament elections.
JPY The Bank of Japan’s stance on reducing long-term government bond purchases may support the yen.
EUR Political uncertainties in France and economic indicators like the European sentiment index weigh on the euro.
AUD The Australian dollar may benefit from falling U.S. interest rates and European political risks. The Reserve Bank of Australia’s hawkish stance and upcoming CPI data will be critical.
ZAR South Africa’s new government and pro-business policies are positively viewed, attracting foreign investment and supporting the rand.
GBP The Bank of England’s rate decision and inflation data will drive the pound, with a focus on when rate cuts might begin.
CAD The Bank of Canada’s rate cuts and upcoming economic data will impact the Canadian dollar. The market expects another rate cut, but recent dollar strength may limit its decline.
P.S.
The debate between Biden and Trump may also see the emergence of a third candidate, Robert F. Kennedy Jr. He is gaining attention due to his family history and controversial stances. His participation could influence the election outcome, affecting the FX market.
Have a great weekend! 😊
