Japanese Yen: USD/JPY (JPY=X) Appetite for Risk Could Trigger Surge Over 112.335
The Dollar/Yen rose to its highest level since December 20 last week as demand for higher risk assets jumped amid a more upbeat outlook on some of the major economies of the world and the prospect of a trade deal between the United States and China. A sharp rise in U.S. Treasury yields in reaction to stronger-than-expected U.S. fourth-quarter Gross Domestic Product report also drove up demand for the U.S. Dollar.
For the week, the USD/JPY settled at 111.933, up 1.264 or 1.14%.
Benchmark 10-year U.S. Treasury yields rose nearly 10 basis points last week, the biggest weekly increase in four months. On Friday, the yield surged to 2.759 percent, a four-week high. This helped widen the spread between U.S. Government bond yields and Japanese Government bond yields, making the U.S. Dollar a more attractive investment.
Stocks rose for a tenth week adding to further evidence of increasing demand for higher-yielding assets.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 113.27.
The projected lower bound is: 110.56.
The projected closing price is: 111.91.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 7 white candles and 2 black candles for a net of 5 white candles. During the past 50 bars, there have been 28 white candles and 20 black candles for a net of 8 white candles.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 85.6766. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 11 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 67.98. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 40 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 298.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 33 period(s) ago.
Rex Takasugi – TD Profile
FOREX JPY= closed up 0.530 at 111.900. Volume was 4% below average (neutral) and Bollinger Bands were 25% narrower than normal.
Open High Low Close Volume___
111.380 112.070 111.310 111.900 100,046
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 110.93 109.81 111.33
Volatility: 5 8 7
Volume: 93,514 95,355 105,385
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 0.5% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of JPY= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on JPY= and have had this outlook for the last 24 periods.
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