Japanese Yen: USD/JPY (JPY=X) EM stress yet to spark haven buying

Japanese Yen: USD/JPY (JPY=X) EM stress yet to spark haven buying

Japanese Yen: USD/JPY (JPY=X) EM stress yet to spark haven buying

While it is impossible to ignore the fact that South Africa is now technically in recession, and Turkey and Argentina are facing currency stress, so far US stock markets have proven to be relatively immune to any contagion. Analysts at Maybank believe that eventually, however, we could start to see some safe-haven plays

“ Still, market angst over EM stresses emanating from Argentina and Turkey could spur safe-haven proxy plays including the JPY and put downside pressure on the pair. The pair though continues to trade in a tight range within 110.50-111.40.”

Despite some encouraging price action, the Malaysian investment bank is noting some weakness creeping into the momentum indicators, and with resistance near overhead, there is a little more room for weakness in USD/JPY to hit the mid 110 levels, which would mark the currency pair finding the heart of its recent range,

“Bullish bias on the daily chart is dissipating and stochastics is turning lower from overbought conditions. Bullish bias on the weekly chart is waning, and stochastics falling. Resistance is around 111.40-levels (50% fibo) ahead of 112.15-levels. Support remains around 110.50-levels (100DMA).”

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 110.77.

The projected upper bound is: 112.65.

The projected lower bound is: 110.43.

The projected closing price is: 111.54.

Candlesticks

A white body occurred (because prices closed higher than they opened).
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 24 white candles and 25 black candles for a net of 1 black candles.

A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).

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 74.8501. This is not an overbought or oversold reading. The last signal was a sell 5 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 55.96. 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 sell 35 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 93. This is not a topping or bottoming area. The last signal was a sell 0 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 9 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed unchanged at 111.520. Volume was 98% below average (consolidating) and Bollinger Bands were 34% narrower than normal.

Open High Low Close Volume___
111.510 111.530 111.460 111.520 1,831

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

Moving Averages: 10-period 50-period 200-period
Close: 111.27 111.24 109.80
Volatility: 5 6 8
Volume: 96,128 103,113 105,515

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 1.6% 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 0 periods.

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