Japanese Yen: USD/JPY (JPY=X) global risk sentiment is deteriorating

Japanese Yen: USD/JPY (JPY=X) global risk sentiment is deteriorating

Japanese Yen: USD/JPY (JPY=X) global risk sentiment is deteriorating

The Japanese yen is currently strengthening against all major currencies. The yen is currently the strongest against the British pound. Last week, the yen moved up sharply against the US dollar. Notably, week-over-week trading volumes in yen futures were up sharply relative to the previous week and compared to weekly averages. The combination of higher prices and rising volumes suggests that traders are buying the currency with conviction. Today’s USD/JPY trading range is 111.40 – 114.20.

Following another weak session across major Asian equity markets today, global risk sentiment is deteriorating. As a safe haven currency, the yen tends to strengthen in response to sell-offs in ‘risk on’ assets. Japan’s Nikkei 225 ended the day lower by 1.87% today while Hong Kong’s Hang Seng Index ended the day down by 1.38%. While the yen is getting help from the downturn in equity markets, global government bond yields remain elevated. 10-year US Treasury bond yields, for example, remain close to highs seen two weeks ago. The same is true for 10-year German bunds. Historically, the yen has moved up sharply when both global equity and global government bond yields fall simultaneously.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 113.17.

The projected lower bound is: 110.86.

The projected closing price is: 112.01.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 27 white candles and 22 black candles for a net of 5 white candles.

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 16.1871. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 8 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 44.13. 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 8 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 -115.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 7 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 sell 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed up 0.240 at 112.000. Volume was 81% below average (consolidating) and Bollinger Bands were 26% wider than normal.

Open High Low Close Volume___
111.760 112.040 111.720 112.000 19,865

Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 112.87 111.86 109.76
Volatility: 7 7 8
Volume: 105,511 103,123 107,957

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 2.0% above its 200-period moving average and is in an downward 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 bearish on JPY= and have had this outlook for the last 1 periods.

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