Japanese Yen: USD/JPY (JPY=X) risk aversion continues to dominate

Japanese Yen: USD/JPY (JPY=X) risk aversion continues to dominate

Japanese Yen: USD/JPY (JPY=X) risk aversion continues to dominate

The USD/JPY pair closed the previous day below the 110 mark for the first time since early April yesterday and extended its slide today to touch its lowest level since the first week of February at 109.60. Following that drop, the pair staged a modest rebound and was last seen trading at 109.90, losing 0.2% on a daily basis.

Earlier today, China’s Commerce Ministry said that they oppose the unilaterally imposed tariffs of the U.S. and reiterated that they will take “necessary countermeasure” if the U.S. increases the tariff rate. “Trade delegation has already left Beijing and Vice Premier Liu’s visit shows China’s sincerity,” the statement further read. Headlines coming out of today’s high-level talks in Washington will be watched closely by participants. If sides fail to reach a deal today, the U.S. is set to hike the tariff rate on $200 billion worth of Chinese imports to 25% from 10% on Friday.

Overall, the bias in prices is: Downwards.

The projected upper bound is: 110.56.

The projected lower bound is: 108.73.

The projected closing price is: 109.65.

Candlesticks

A black body occurred (because prices closed lower 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 22 white candles and 28 black candles for a net of 6 black candles.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 13.2151. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 15 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 26.32. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 90 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 -134.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 6 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 11 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed down -0.060 at 109.690. Volume was 95% below average (consolidating) and Bollinger Bands were 23% wider than normal.

Open High Low Close Volume___
109.750 109.800 109.680 109.690 4,218

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

Moving Averages: 10-period 50-period 200-period
Close: 110.75 111.26 111.47
Volatility: 3 5 7
Volume: 68,884 86,548 100,757

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 1.6% below its 200-period moving average and is in an downward 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 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 4 periods. Our momentum oscillator is currently indicating that JPY= is currently in an oversold condition.

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