Dollar slightly softer in early Asian afternoon tradingReleases from Japan:

April Prior Current
Tokyo Department Store Sales (YoY) - 0.7% - 0.7%
Nationwide Department Store Sales (YoY) - 1.2% - 3.4%

Reuters published their Tankan survey report for May and provided no relief for the gloom and doom currently overhanging the Japanese economy. Manufacturers’ sentiment remained soft to bring the headline index to zero, the lowest level in almost 5 years.
In a separate report Japanese companies are forecasting a 5.8% drop in profits in this fiscal year which will be the first decline in 7 years. This almost certainly puts any possible hike in wages on the back burner to leave the consumer fighting hard to cover monthly budgets and further depress domestic demand.

Releases from U.K.:
Prior Current
May Rightmove House Prices (MoM) - 0.1% +1.2%
May Rightmove House Prices (YoY) +1.3% +2.2%
The U.K.’s Rightmove reported an unexpected rise in house prices but at the same time firmly squashed the prospect that this may imply any rebound in the market. The rise was driven by house sellers who sought to take advantage of the seasonal rise in house moves but the company warned that it is a mistaken strategy.
“Sellers who are hanging out to achieve last year's prices need to accept that the market has fallen and that they will end up being punished by a lower price in the long run,” they commented. “The free-flowing mortgage tap has turned off.”
“Sellers need to act in a more coordinated way to help improve affordability throughout the chain. However, there are thousands of estate agents and hundreds of thousands of sellers, so reaction to a deteriorating market is a slow process.”

The following economic releases are due today:
March
Euro-zone Construction Output (MoM) +1.2% (prior)
Euro-zone Construction Output (YoY) +4.3% (prior)
April
Bank of France Business Sentiment 105.0 (prior)
U.S. Leading Indicators - 0.1%

My reversal on Friday to being more bearish proved timely with the wave structures really not giving the upside much hope. The weakness actually crept in by the end of the day following the anticipated consolidation but the first leg of this next part of the decline is probably almost over.
Taking a step back it looks like we are seeing a larger pullback to the Dollar’s gains from the lows. Specifically looking at the Euro I suspect this entire correction will take another 2-3 weeks and should provide a rather unpleasantly high degree of erratic range trading broken by breaks and then a return to consolidation. In other words it does look as if it could be pretty frustrating.
That should mean that today’s Dollar downside should be limited to around 1.5151 Euro, 1.0371-95 Swissie and 1.9631-61 Cable. From these levels look for move back into consolidation.
I have omitted Dollar-Yen as I have a slightly higher degree of uncertainty here. We saw losses which actually breached the 103.65 target I had but not by that much. This structure is still uncertain. Over the next 2 months I am basically more bearish than bullish and would expect a break below the 95.71 low. So more the question is whether the 105.68 high satisfied the daily correction for which I had an ideal target at 106.82 or whether there is chance of one more attempt higher.
The more that it fails on the upside the fact that my ideal target is at 90.66 it seems that we do need a reasonable amount of time for that to be achieved. Thus it will be best to be aware of the larger downside risk now and be prepared for stronger losses developing very soon.

Note important support and resistance areas:
USDJPY EURUSD USDCHF GBPUSD
Res: 105.43-68 1.5692-37 1.0559-90 1.9712-64
Res: 104.49-98 1.5636-56 1.0495-25 1.9631-61
Spt: 103.51-85 1.5535-70 1.0395-30 1.9523-54
Spt: 102.80-30 1.5443-73 1.0335-71 1.9452-80
See Also

Retrouvez d'autres analyses sur les devises dans la rubrique analyse forex du site Trader-Forex.