Japanese Yen: USD/JPY (JPY=X) Stock sell-off, mixed data
Global stock markets dropped sharply and set the tone for currencies as well. A mix of concerns about the Fed’s rate hikes, Trump’s tariffs, a slowdown in emerging markets, Brexit, and Italy’s stand-off with the EU all weighed. Towards the end of the week, unimpressive earning by some big companies also hurt stocks.
US data was mixed, with GDP advancing by 3.5% but this consisted of an increase in inventories and a fall in exports, not the right kind of growth. Other figures such as housing and durable goods orders were mixed.
115.55 was a high point in the first half of 2017 and is an upside target. 114.60 was the high point in early October and serves as resistance.
114 is a round number and was a stepping stone on the way down. 113.50 supported USD/JPY when it traded on high ground.
113.15 was a swing high back in July. 112.55 served as support in September and resistance in October, making it a significant level.
111.80 was the low point after the fall in mid-October. 111.50 capped the pair in August.
110.60 was a swing low in late July and then again in late August. 109.70 was a swing low in late August and provides extra support below the round 110 level.
Close by, 109.35 was a cushion in mid-July. 108.70 was a cushion early in the summer and 108.10 a swing low in late May.
Lower, we find 107.50 capped the pair in early April and is a strong line.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 113.02.
The projected lower bound is: 110.69.
The projected closing price is: 111.86.
A black body occurred (because prices closed lower 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 28 white candles and 21 black candles for a net of 7 white 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 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 38.8208. This is not an overbought or oversold reading. The last signal was a buy 9 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 42.97. 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 sell 17 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 -126.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 8 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 down -0.070 at 111.820. Volume was 97% below average (consolidating) and Bollinger Bands were 22% wider than normal.
Open High Low Close Volume___
111.900 111.980 111.800 111.820 3,326
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 112.32 112.15 109.82
Volatility: 6 7 8
Volume: 111,594 105,569 108,685
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 1.8% above its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. 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 10 periods.
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