Japanese Yen: USD/JPY (JPY=X) showing signs of life

Japanese Yen: USD/JPY (JPY=X) showing signs of life

Japanese Yen: USD/JPY (JPY=X) showing signs of life

The US dollar has initially dipped during the trading session on Monday, but then bounced enough to show signs of life again as the market continues to struggle with the idea of ¥110 as resistance. Ultimately, this is a market that moves right along with risk appetite, so it is worth paying attention to the stock markets and the like in order to discern which direction this market should be going. After all, the Japanese yen is considered to be the ultimate “safety currency”, and as there is a lot of fear out there it wouldn’t be a huge surprise to see the market rollover based upon some type of headline.

All that being said, the stock markets were closed in the United States for Presidents’ Day, so that of course will have an influence on the market. Longer-term, the market will continue to look at the ¥110 level as a major barrier, so if we can make a fresh, new high that would be very good sign for this pair, allowing it to grind towards the ¥111 level, and then the ¥112 level. To the downside, the 50 day EMA which is painted in red on the chart should offer support, just as the uptrend line well. A break of the uptrend line opens up the door to the ¥105 level. When looking at the longer-term charts, the ¥110 level is essentially “fair value” between the ¥105 level and the ¥115 level that has been so supportive and resistive over the longer term.

Technical Indicators

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 109.21.

The projected upper bound is: 110.74.

The projected lower bound is: 108.96.

The projected closing price is: 109.85.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 5 black candles for a net of 1 black candles. During the past 50 bars, there have been 24 white candles and 25 black candles for a net of 1 black candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

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 42.6830. This is not an overbought or oversold reading. The last signal was a sell 5 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 55.14. 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 135 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 51. This is not a topping or bottoming area. The last signal was a sell 3 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 8 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed down -0.050 at 109.830. Volume was 97% below average (consolidating) and Bollinger Bands were 2% wider than normal.

Open     High      Low     Close     Volume___
109.860 109.900 109.790 109.830 2,227
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 109.84 109.38 108.37
Volatility: 3 5 7
Volume: 77,510 75,692 86,445

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 1.3% above its 200-period moving average and is in an upward trend. Volatility is high 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 bullish on JPY= and have had this outlook for the last 7 periods.

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