• USD/JPY slides lower ahead of European morning trade
• USD/JPY Technical Analysis – Keep an eye on this important resistance
• ECB’s Kažimír: Market pricing of two rate cuts by year-end is not entirely misplaced
• Bundesbank calls for rate cuts to be „carefully considered“ as inflation risk persists
• PBOC lowers standing lending facility rates by 10 bps
• SNB total sight deposits w.e. 19 July CHF 461.3 bn vs CHF 458.9 bn prior
• Nvidia reportedly working on version of new flagship AI chip just for Chinese market

Markets:

• JPY leads, AUD lags on the day
• European equities higher; S&P 500 futures up 0.5%
• US 10-year yields down 2 bps to 4.219%
• Gold up 0.1% to $2,402.24
• WTI crude down 0.4% to $78.32
• Bitcoin up 0.7% to $67,470

It was a quiet session as the European calendar is looking to embrace the summer lull. There weren’t any key releases – the same case will be for tomorrow as well – so traders had very little to work with.

The Japanese yen saw a nudge higher early on before European markets opened, with USD/JPY falling from 157.30 to a low of 156.28. The pair bounced back slightly after but is still down 0.5% on the day, seen at 156.60 levels now.

There wasn’t any major catalyst for the move as traders are still sorting out their feet following the news over the weekend that Biden has bowed out of the presidential election. 10-year yields in the US are hanging slightly lower, down 2 bps to 4.219% currently.

Besides that, the dollar is keeping steadier elsewhere with light changes overall. The aussie and kiwi are slightly lower though, owing to a softer Chinese yuan. That comes after the PBOC introduced a number of easing measures earlier in the day, weighing on the yuan currency.

In other markets, equities are looking to bounce back after a disappointing showing last week. Tech shares are leading the charge with Nasdaq futures up nearly 1% now. However, we do have key earnings coming up tomorrow after the close with Alphabet (Google) and Tesla set to report.

It’s a brighter start to the new week after the heavy selloff in the second half of last week. But it’s still too early to say that the optimism here is enough to carry stocks until the end of the week.

This article was written by Justin Low at www.forexlive.com.