Japanese Yen: USD/JPY (JPY=X) investors watching BoJ inflation

Japanese Yen: USD/JPY (JPY=X) investors watching BoJ inflation

Japanese Yen: USD/JPY (JPY=X) investors watching BoJ inflation

USD/JPY has started the week with slight gains, erasing the losses seen on Friday. In the North American session, the pair is trading at 109.54, up 0.21% on the day. On the release front, Japanese Services Producer Price Index, which has hovered at 1.1% for four straight months, is expected to tick higher to 1.2%. On Tuesday, Japan releases BoJ Core CPI, which is the bank’s preferred inflation index. The indicator gained 0.5% in the previous release. In the U.S., the key release is CB Consumer Confidence.

The Japanese yen thrives off high risk apprehension and the spike in trade tensions have boosted the safe-haven currency in recent weeks. USD/JPY has slipped 1.7% in the month of May. On Thursday, the yen improved by 0.68%, its strongest gain since late March. Trade tensions between the U.S. and China have escalated, and a trade deal between the two super-economies has not materialized, despite assurances from U.S. officials that substantial progress has been made. China has reacted angrily to U.S. sanctions on Huawei and has suspended trade talks with the U.S. Investors remain nervous about the U.S.-China conflict and the weak global economy, which bodes well for the yen.

U.S. indicators ended the week on a disappointing note, as April durable goods orders were softer than expected. Durable goods orders slumped 2.1%, just below the estimate of -2.0%. This marked the sharpest decline since January 2018. The core reading slowed to 0.0%, down from 0.4% a month earlier. The U.S. economy has been performing well, and the economy will receive a report card on Thursday, with the release of Preliminary GDP for the first quarter, which is expected to post a strong gain of 3.1%. The initial GDP reading showed a gain of 3.2%, crushing the estimate of 2.2%. Will the revised release also beat expectations? If so, traders can expect the U.S. dollar to post broad gains.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 110.64.

The projected upper bound is: 110.46.

The projected lower bound is: 108.46.

The projected closing price is: 109.46.

Candlesticks

A white body occurred (because prices closed higher 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 25 white candles and 25 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 12.2008. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 3 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 37.84. 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 10 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 -65. This is not a topping or bottoming area. The last signal was a buy 9 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 0 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed unchanged at 109.500. Volume was 97% below average (consolidating) and Bollinger Bands were 15% wider than normal.

Open High Low Close Volume___
109.490 109.540 109.450 109.500 2,432

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

Moving Averages: 10-period 50-period 200-period
Close: 109.82 110.85 111.40
Volatility: 6 6 7
Volume: 80,660 86,959 100,008

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 1.7% below its 200-period moving average and is in an downward trend. Volatility is 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 16 periods.

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