Japanese Yen: USD/JPY (JPY=X) Little Guidance from Global Equity Markets
The major equity indexes in Asia are trading mixed on Monday with investors watching out for developments on the U.S.-China trade situation. Negotiators are set to go back to the table later after taking the week off due to the Lunar New Year holidays.
Last week, the global stock markets were shook up by the news that the United States and China were still far from settling their trade issues. Selling pressure was also fueled by a report that said U.S. President Trump and Chinese President Xi Jinping wouldn’t meet until after the March 2 deadline.
Dollar/Yen traders are watching the price action in the equity markets because lower demand for risky assets tends to make the Japanese Yen a more desirable safe-haven asset. Today’s mixed price action is actually encouraging investors to move money back into the U.S. Dollar.
Mixed Treasury Markets Underpinning Dollar/Yen
Last week, safe-haven buying drove U.S. Treasury yields lower. This tightened the spread between U.S. Government bond yields and Japanese Government bond yields, making the U.S. Dollar a less-attractive investment. Early Monday, U.S. 10-year Treasury note yields are rising, and U.S. 30-year Treasury bonds are dropping. This is sending a mixed signal to Dollar/Yen traders, which is helping to underpin the Forex pair.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 111.57.
The projected lower bound is: 108.66.
The projected closing price is: 110.11.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 4 black candles for a net of 1 white candles. During the past 50 bars, there have been 23 white candles and 26 black candles for a net of 3 black 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 70.0002. This is not an overbought or oversold reading. The last signal was a sell 1 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 56.22. 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 26 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 113.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 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 buy 19 period(s) ago.
Rex Takasugi – TD Profile
FOREX JPY= closed up 0.460 at 110.180. Volume was 68% below average (consolidating) and Bollinger Bands were 48% narrower than normal.
Open High Low Close Volume___
109.820 110.270 109.670 110.180 34,791
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 109.63 110.34 111.27
Volatility: 5 8 7
Volume: 93,444 101,528 105,402
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 1.0% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 10 periods.
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