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USDJPY Time to Buy the Japanese Yen

Posted by: : Shayne HeffernanPosted on: October 19, 2014 USDJPY Time to Buy the Japanese Yen

USDJPY Time to Buy the Japanese Yen

Shayne Heffernan has a 12 month 102 target on the USDJPY

The survey, conducted from Sept. 30 to Oct. 14, found 45 percent of companies want the government to start talking up the yen or defend it with market intervention at around 110 to the dollar. That suggests that this level could become a key point at which corporate pressure on the government to do something about yen weakness intensifies.

But it also found that some 23 percent of firms want action at around 115 yen and 20 percent prefer around 120 yen, with the remainder happy to wait for weaker levels. That suggests that authorities in export-reliant Japan will also be cautious in weighing the pros and cons of interfering in the market.

The survey polled executives at 486 firms capitalized at more than 1 billion yen, who responded anonymously. About 240 firms answered questions on foreign exchange.

Asked to forecast yen moves for the next 12 months, almost 60 percent of firms said they saw it moving between 100 and 110, while 35 percent projected a range of 110-120.

The survey, conducted for Reuters by Nikkei Research, also showed that only 20 percent of firms think the economy – bruised by a sales tax hike this year – is ready to weather a second such tax hike planned for next year. Thirty-three percent say it won’t cope while the rest declined to say either way. The result highlights a tough choice for Abe when he makes a final decision on the tax in December.

USDJPY closed up 0.240 at 107.110. Volume was 74% below average (consolidating) and Bollinger Bands were 56% wider than normal.

Open High Low Close Volume___
106.960 107.270 106.930 107.110 14,096

USDJPY Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 107.17 106.31 103.25
Volatility: 10 9 7
Volume: 85,177 60,144 57,192

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.


FOREX JPY= is currently 3.7% above its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume out of JPY= (mildly bearish). Our trend forecasting oscillators are currently bearish on JPY= and have had this outlook for the last 5 periods.

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Shayne Heffernan Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

Trade FX, Equities and Options with the World's Leading Platform , call our trade desk 631 482 0376, or contact us to get started.

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