📉 [Yen Strength & Ongoing Dollar Weakness] – USD/JPY Pressured by U.S. Asset Selling and Geopolitical Risk
📅 Wednesday, May 21, 2025
✅ Market Overview | USD/JPY pressured by U.S. outflows and geopolitical tension
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USD/JPY continued to slide toward the mid-143 range, with little sign of recovery. Yen strength remains persistent.
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Cross-yen pairs are also weak overall, led by a yen-dominant tone.
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EUR/USD, GBP/USD, and AUD/USD all advanced, making the dollar’s weakness increasingly apparent.
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U.S. 10-year yields rose to 4.52%, while U.S. equity futures softened in after-hours trading.
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The U.S. Dollar Index broke below the key 100 level, reaching its lowest level since May 7.
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UK CPI came in hot, pushing GBP/USD to its highest levels in nearly three years, contributing to overall dollar selling.
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Reports of rising tension between Israel and Iran added to risk-off sentiment and yen buying flows.
📅 Economic Calendar (Key Overseas Events)
🔸 Economic Indicators
| Region | Indicator | Importance |
|---|---|---|
| 🇿🇦 South Africa | CPI (Apr), Retail Sales (Mar) | Medium |
| 🇺🇸 U.S. | MBA Mortgage Applications, Weekly Oil Inventory, 20-Year Bond Auction ($16B) | Low to Medium |
🔸 Speeches & Central Bank Events
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🇪🇺 ECB: Vice President de Guindos, Bank of Portugal’s Centeno, Chief Economist Lane
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🇬🇧 Former BOE MPC Member Tenreyro
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🇺🇸 Fed: Governor Bowman, Richmond Fed’s Barkin (Fed Listens Event)
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🇪🇸 Spain: Central Bank Governor Escrivá
→ Market impact from ECB speeches and financial stability reports (including negative rate debates) could outweigh Fed commentary.
→ Geopolitical risks in the Middle East likely to drive volatility more than central bank events today.
📈 Focus Assets & Strategy Summary | Wednesday, May 21, 2025
| Asset | Strategy | Comment |
|---|---|---|
| USD/JPY | Bearish bias continues | Sell on rallies. Key support at 143.00, with option barriers on May 23/26/28. Watch closely. |
| BTC/USD | Continue buying dips | Key test at 110,000 resistance. Supported by geopolitical risk + dollar weakness. |
| EUR/USD | Firm tone | Bullish bias supported by dollar weakness and upcoming eurozone PMI. Watch ECB’s hawkish tone. |
| GBP/USD | Breakout continuation | Strong CPI lowers BOE rate cut expectations; technicals remain in bullish trend. |
| AUD/USD | Sideways with support | RBA dovish tone limits upside, but risk-on sentiment provides a floor. |
📌 Summary
Triple pressures—USD weakness, JPY strength, and U.S. asset outflows—are shaping overall market sentiment.
The prevailing trend favors:
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Dollar selling
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Yen buying
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Safe-haven demand for Gold and Bitcoin
Key focus: the 143.00 level in USD/JPY, where heavy option activity suggests potential volatility. Be cautious of headline-driven swings around this zone.
