Japanese Yen: USD/JPY (JPY=X) Close to Resistance

Japanese Yen: USD/JPY (JPY=X) Close to Resistance

Japanese Yen: USD/JPY (JPY=X) Close to Resistance

If the NKY and US 10 y yields continue to track higher, there is no reason the markets shouldn’t take out 114 this week. However, counter to my original thoughts that the USDJPY was an under-owned position, the latest CFTC data is painting a decidedly different picture as Yen shorts are at the highest level since early March. However, these derivative positions could have different paths of dependency than strictly the USD.

So with US interest rates set to rise for the foreseeable future albeit with caveats that the US economy doesn’t go into the tank,  Regardless, with US interest rates set to rise for the foreseeable future albeit with caveats that the US economy doesn’t go into the tank, USDJPY should move higher.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 111.60.

The projected upper bound is: 114.82.

The projected lower bound is: 112.74.

The projected closing price is: 113.78.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 28 white candles and 21 black candles for a net of 7 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

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 Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 95.6301. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 22 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 71.08. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 52 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 148.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 17 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 26 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed up 0.050 at 113.730. Volume was 97% below average (consolidating) and Bollinger Bands were 48% wider than normal.

Open High Low Close Volume___
113.680 113.780 113.650 113.730 3,232

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 112.89 111.51 109.75
Volatility: 4 6 8
Volume: 97,401 100,354 105,495

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.

Summary

FOREX JPY= is currently 3.6% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into JPY= (mildly bullish). Our trend forecasting oscillators are currently bullish on JPY= and have had this outlook for the last 16 periods. Our momentum oscillator is currently indicating that JPY= is currently in an overbought condition.

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