Japanese Yen: USD/JPY (JPY=X) investors searching for cues

Japanese Yen: USD/JPY (JPY=X) investors searching for cues

Japanese Yen: USD/JPY (JPY=X) investors searching for cues

While the US dollar vs Japanese yen pair ( USD / JPY ) is one of the few major pairs that didn’t succumb to the strength in the greenback this morning, Fed Powell’s dovish comments could be seen as supportive for risk-on trades and put a lid on the Japanese yen.

Technically, the pair touched a falling channel support early this morning and rebounded sharply to trade at 111.08, as of 8:15 London time. The upper channel line, which now acts as a support after the pair broke out of the channel on Thursday, also aligns with the August 17 high of 110.89. This could create some buying pressure for the pair in the short-term.

To the upside, I see Friday’s high of 111.47 as the first potential resistance level, followed by the August 1 high of 112.14. A decisive break below the channel support at 110.89 would invalidate the long setup and aim for the August 20 high of 110.67, followed by the August 21 low of 109.76.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 112.17.

The projected lower bound is: 109.97.

The projected closing price is: 111.07.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black 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 85.7714. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 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 51.02. 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 27 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 80. 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 1 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed down -0.160 at 111.060. Volume was 7% below average (neutral) and Bollinger Bands were 32% narrower than normal.

Open High Low Close Volume___
111.240 111.360 110.920 111.060 94,566

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

Moving Averages: 10-period 50-period 200-period
Close: 110.77 111.05 109.82
Volatility: 6 6 8
Volume: 109,387 104,766 106,147

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 1.1% 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 moderate flows of volume out of JPY= (mildly bearish). Our trend forecasting oscillators are currently bearish on JPY= and have had this outlook for the last 21 periods.

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