Japanese Yen: USD/JPY (JPY=X) likely to be influenced by a slew of major U.S. economic data
The Dollar/Yen closed higher last week as investors shrugged off predictions of a U.S. recession later in the year. Although U.S. Treasury yields tumbled to multi-year lows, the dollar lost no value against the Japanese Yen. There wasn’t even a follow-through to the downside after the previous week’s steep sell-off. Increased appetite for riskier assets also helped drive demand for the U.S. Dollar.
Throughout the week, the big story was the steep plunge in U.S. Treasury yields, however, the USD/JPY traders seemed unfazed by the drop. Last week, the 10-year U.S. Treasury hit its lowest level since 2017 as investors worried about slowing economic growth. The previous week, the yield on the 10-year Treasury note fell below that of the 3-month bill for the first time since 2007. This inverted the yield curve which raised a red flag about a future recession.
There were no major reports out of Japan last week, but the mid-level reports were mixed with the Unemployment Rate falling to 2.3% and Housing Starts jumping 4.2%. However, Retail Sales came in lower than expected at 0.4%.
The Bank of Japan Summary of Opinions showed that policymakers debated the feasibility of ramping up monetary stimulus at their rate review in March as heightening overseas risks weighed on the country’s fragile economy.
In the U.S, Consumer Confidence came in at 124.1, well-below the 132.1 forecast. Final GDP also missed the 2.4% forecast, coming in at 2.2%.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 111.85.
The projected lower bound is: 109.87.
The projected closing price is: 110.86.
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 26 white candles and 22 black candles for a net of 4 white candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 77.9892. This is not an overbought or oversold reading. The last signal was a buy 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 50.36. 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 60 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 -16. This is not a topping or bottoming area. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 14 period(s) ago.
Rex Takasugi – TD Profile
FOREX JPY= closed up 0.220 at 110.840. Volume was 4% below average (neutral) and Bollinger Bands were 20% narrower than normal.
Open High Low Close Volume___
110.610 110.940 110.520 110.840 96,110
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 110.67 110.54 111.45
Volatility: 7 6 7
Volume: 97,778 95,216 104,370
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.
FOREX JPY= is currently 0.5% below 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 5 periods.