Japanese Yen: USD/JPY (JPY=X) BoJ’s interest rate decision was to remain on hold
JPY weakened somewhat as BoJ’s interest rate decision was to remain on hold as was widely expected. The decision was accompanied by cuts in the forecasts for the core CPI rate in 2019/20 and a small boost in the forecast for the GDP growth rate. In the accompanying statement, the bank left the forward guidance on rates unchanged as it stated that it will keep current extremely low rates for an extended period of time.
The bank also noted that the core CPI rate maintains a weak trend if compared to economic expansion and the current tight labour market. Analysts pointed out that the bank seems to be in no hurry to reach its +2.00% yoy inflation target, yet we maintain our concerns about the course of the Japanese economy and the negative effect it may have on the JPY.
Also a weakening of the JPY could occur as a safe haven, should there be further positive developments for the US-Sino trade relationships. The bearish sentiment for the JPY could strengthen and volatility could extent throughout Governor Kuroda’s press conference later on. USD/JPY maintained a range bound motion yesterday, rising slightly albeit remaining between the 109.20 (S1) support line and the 110.15 (R1) resistance line.
We could see the pair maintaining a sideways motion today as no important financial releases affecting the pair are due out. Some sensitivity could be displayed should there be any headlines about the US-Sino trade relationships. Should the pair’s long positions be favored by the market, we could see the pair, breaking the 110.15 (R1) resistance line and hover above it. Should on the other hand, the pair come under the selling interest of the market, we could see it breaking the 109.20 (S1) support line and aim for lower grounds.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 110.96.
The projected lower bound is: 108.01.
The projected closing price is: 109.49.
During the past 10 bars, there have been 6 white candles and 3 black candles for a net of 3 white candles. During the past 50 bars, there have been 23 white candles and 26 black candles for a net of 3 black candles.
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 64.6438. This is not an overbought or oversold reading. The last signal was a sell 1 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 47.31. 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 14 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 91. This is not a topping or bottoming area. The last signal was a sell 0 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 7 period(s) ago.
Rex Takasugi – TD Profile
FOREX JPY= closed down -0.020 at 109.570. Volume was 98% below average (consolidating) and Bollinger Bands were 16% narrower than normal.
Open High Low Close Volume___
109.570 109.640 109.520 109.570 1,667
Short Term: Overbought
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 109.16 111.21 111.24
Volatility: 5 8 7
Volume: 91,387 104,707 104,509
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 1.5% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of JPY= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on JPY= and have had this outlook for the last 34 periods.