Yen bulls back in business, but what about USD bears?

Looking ahead: US treasury yields, busy calendar today.
The groundwork we have been looking for official support the US treasury market is now coming into view: the FT led with a story this morning that US authorities are set to announce a cut to the largest US banks' capital requirements, the supplementary leverage ratio. Such a move would allow the banks to leverage their balance sheets more, and many would see this initiative as aimed at the US treasury market to temper any further rise in yields, as banks could hold more US treasuries. Details are few, and one option might also be instead to simply exclude US Treasuries entirely from the bank leverage calculation. I’m surprised we haven’t seen a bigger reaction to this in the US treasury market, but to me this is a sign that the US Treasury will lean very hard against any further rise in treasury yields, a cornerstone of the longer term USD bearish case.

Today we have a raft of US data, including April Retail Sales, and it’s nice to hear from Walmart in its quarterly earnings report before the market open later today. The initial claims number is also important if it shows any big jump (not expected). Less important data include the regional manufacturing surveys, the Empire and Philly Fed, and Fed Chair Powell is out speaking shortly after the Retail Sales release at 1230 GMT.

Interesting to note Trump on the wires this morning from Qatar claiming that India is willing to drop all tariffs on US imports. He also said he doesn’t want Apple to move its production to India from China – clearly, he wants it moved to the US.

FX Board of G10 and CNH trend evolution and strength.
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A huge shift in JPY momentum over the last couple of sessions, though this does not yet change the trend – next couple of sessions key there. Elsewhere, gold is in correction mode in the big picture, and very weak in the near-term picture – note the key 3165 area on the chart there versus the USD. In general, though, note the very flat trend readings across the board – lots of uncertainty and the risk that things may take some time to sort out, with falling volatility.

Table: NEW FX Board Trend Scoreboard for individual pairs.

Silver is on its back foot now, slipping into a downtrend. AUDNZD is trying to cement its new uptrend after a strong AU jobs report overnight, even if AUDUSD has wilted off the highs. EURCHF has teased local resistance and failed, just as the trend status looks pivotal!