USDJPY Subdued at Key Tech as Fed & BoJ LoomThe pair comes from its longest losing streak of the year (four week), correcting from its 38-year peak at the beginning of the month. It tests crucial technical levels provided by the 200Days EMA (blue lines) and the 38.2% Fibonacci of the rally from the December 2023 low to the aforementioned high. This creates risk for deeper decline towards the 61.8% Fibo that would bring 146.47 in the spotlight. On the other hand, USD/JPY tries to defend this support cluster, above which it can push for EMA200 (black line). Retaking it would give bulls control and the opportunity to challenge 161.94, although the upside does not look particularly friendly.
Other than intervention speculation, the USD/JPY slide is a result of the shift in the monetary policy dynamics and this week’s decisions by the Fed and the BoJ can determine the pair’s trajectory and spur volatility. The Bank of Japan has followed a slow and cautious path to normalization after the March exit form negative rates and there is mounting anticipation for bolder action this time around. Markets see policymakers announcing a reduction in bond purchases and there are also expectation for another hike, but the latter appears to be more contentious. Such action could help the Yen’s rebound, but BoJ has shown apprehension and has surprised markets before.
The US Fed on the other hand appears to be coming closer to a rate cut following the resumption of disinflation and moderation in job gains. Markets are aggressively pricing three moves this year and expect policymakers to lay the ground for a Fed pivot at this week’s meeting.
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Boj
Beginning of the AJ Bull's END?!Here I have AUD/JPY on the Daily Chart!
Beginning in March of 2020 to what seems to be the new High @ 109.372 in July of 2024, we have seen the end of the 5th Wave of Elliot's Impulse Wave!
With Prices steep decline to the new LOWER LOW @ 99.209, knocking out the Low of June and Testing the Low of May, these are the conditions needed for what could potentially turn into a Correction Wave!!!
The Sellings have BEGUN!
-You can see that the RSI after this enormous drop in price Breaking Lows ( Structure) is now operating under the 50 mark & Oversold!
-The BB Trend is now printing Red Bars showing signs of Bears in the vicinity!
Where might Price go??
-If 99.209 is our True Lower Low we will be working with, I suspect price will make a STRONG retracement!
*Potential Retracement Levels*
( 103.091 - 103.691 ) - Golden Zone
( 104.291 - 105.490 ) - 50% / 38.2%
-Fundamentals-
*Uncertainty of BOJ decision mixed with the suspected COOLING of inflation on AUD may be just the catalyst we need to see this pull off!
AUD - CPI q/q & y/y - Tuesday, July 30th
JPY - BOJ Policy Rate - Tuesday, July 30th
Focus on Buying Opportunities and Key Event AlertThis week, I’m focusing on buying opportunities more than shorting. Here's a key level and some important advice if you’re trading Japanese Yen related pairs.
Current Overview:
- Key Level for Buying:
1. Support Level: 153.45
2. What to Do: Wait for a Magic Candle Confirmation at this level to enter a buy position.
Important Event Alert:
- Date: 31 July
- Event: Bank of Japan (BOJ) Interest Rate Decision
- Impact: Whether the BOJ increases the Japan Interest Rate or not, it will significantly affect the Japanese Yen movement.
Strategy:
1. Magic Candle Confirmation: At 153.45, wait for this confirmation before entering a buy position.
2. Managing Running Trades:
- 50 Pips Profit : If you have a running profit of 50 pips or more, consider shifting your stops to entry to protect yourself from undesirable surprises.
- Less Than 50 Pips Profit: Start planning your trade move before the BOJ announcement.
Key Considerations:
- Exiting Trades Before Announcement: Decide if you’re comfortable exiting your trades before the Bank Rates announcement, even if the market moves significantly in your favour.
- Holding Through Announcement: Alternatively, consider the risk of holding through the announcement and how you’d manage your trade based on the market reaction to the BOJ decision.
Final Thoughts:
Be cautious and plan your trades carefully this week. Whether you choose to protect your profits or take a risk on the BOJ announcement, make sure you’re prepared for any outcome.
What’s your plan for this week? Are you focusing on buying opportunities or do you have a different strategy? Share your thoughts and strategies below!
Happy trading, everyone! 🚀
USD/JPY remains volatile, US PCE Price Index nextThe Japanese yen has hit the brakes on this week’s impressive rally. USD/JPY is trading at 154.34 in the European session, up 0.30% on the day. On Thursday, the yen climbed as much as 1.3% but gave up all of those gains after the strong US GDP report. Still, the yen is up 1.9% this week.
Tokyo Core CPI rose to 2.2% y/y in July, a notch higher than the 2.1% gain in June and matching the market forecast. This is the third straight acceleration and the highest level since March. Higher electricity prices drove the gain. Earlier this week, service inflation for businesses rose to 3% in July, up from 2.7% in June and above the market forecast of 2.6%. This was the highest level in 33 years.
The Bank of Japan faces a tough task and must decide whether to maintain policy or deliver a rate hike at next week’s meeting. It’s a close call as to what decision the central bank will make and Bank officials can be expected to maintain radio silence.
There are strong arguments for both sides. Inflation and wage growth have been moving higher which would support a rate hike. As well, a rate hike could give a boost to the yen, which has been trading at multi-year lows. On the other hand consumption remains weak and a rate hike would only further dampen consumer spending.
Later today, the US releases Core PCE Price index, which is the Federal Reserve’s preferred inflation measure. The index is expected to rise 0.1% m/m in June, matching the May figure. The PCE Price index is expected to ease to 2.5% y/y, down a notch from 2.6% in May.
USD/JPY has pushed past resistance at 154.03 and is testing resistance at 154.39, followed by 154.68
153.74 and 153.38 are the next support levels
USD/JPY – Yen on a tear, US GDP blows past forecast
The Japanese yen continues to gain ground against the US dollar. USD/JPY is trading at 153.68 early in the North American session, down 0.14% on the day. Earlier today, USD/JPY fell as low as 151.93 (1.3%), its lowest level since May 3, before paring most of these losses. The yen has soared, rising 2.4% this week and a staggering 4.5% in the month of July.
There’s plenty of buzz but also uncertainty in the air as the yen has gone on a torrid run against the hapless US dollar. The yen jumped 1.1% on Wednesday after a senior Japanese official urged the Bank of Japan to normalize policy. As well, the sharp drop in global tech stocks sent investors fleeing to traditional safe havens, including the Japanese yen.
The Bank of Japan meets on July 30-31 and it’s a close call as to whether it will stay on the sidelines or raise interest rates. The central bank is also expected to announce details of a plan to cut bond purchases in order to reduce its massive monetary stimulus.
The BoJ has hinted that a rate hike is coming, but the question of timing is up in the air. Core inflation rose to 2.6% in June and wages have climbed sharply, setting up the case for the central bank to raise rates. On the other side of the coin, consumer spending has been weak and inflation is relatively moderate.
The US economy climbed 2.8% y/y in the second quarter, double the 1.4% rate in the first quarter and blowing past the forecast of 2.0%. An increase in consumer spending helped drive the strong gain. On the inflation front, the personal consumption expenditures price index, a key measure for the Federal Reserve, eased to 2.6%, down from 3.4% in Q1.
USD/JPY tested support at 152.68 earlier. Below, there is support at 151.45
There is resistance at 154.33 and 155.56
Strong JPY, Weak Nikkei. Trading Plans Post FallAs the JPY has gained value, on propping up rumours via Japan Authorities, we have seen a drop in the Nikkei.
The pro growth rates set by the BOJ have allowed the Japanese Nikkei to grow to higher highs continually, inline with the positive market sentiment spurred on by a better global economic outlook and a soft landing.
A retracement, however, would reflect some of the economic woes induced by low rates. Anything that turns this around will likely take us back to highs.
Conversely, a continuation of current sentiment will bring us lower. Any longs, therefore, must be tiny, if any. Save them till later.
Levels Discussed Post US CPI and BoJ InterventionDXY: Now consolidating on 104.50, needs to stay below 104.80 to remain bearish, with key support at 104 round number.
NZDUSD: Buy 0.61 SL 20 TP 50
AUDUSD: Buy 0.6810 SL 20 TP 60
USDJPY: Look for reaction at 160 (possible 2nd intervention level from BoJ)
GBPUSD: Buy 1.2940 SL 40 TP 90
EURUSD: Look for reaction at 1.0920
USDCHF: Looking for reaction at 0.89
USDCAD: Likely to range between 1.36 and 1.3650
Gold: Needs to break 2420 to trade up to 2450
Levels discussed on livestream 27th June27th June
DXY: testing the support level (105.90) needs to stay above 105.75. Look for bounce to 106.40 (needs to break previous high)
NZDUSD: Sell 0.6065 SL 25 TP 80
AUDUSD: Test and reject 0.67, Sell 0.6695 SL 20 TP 60
USDJPY: Buy 161.10 SL 30 TP 90 (look to close quick!!!) Becareful, possible intervention area
GBPUSD: Sell 1.2590 SL 20 TP 75
EURUSD: Sell 1.0665 SL 15 TP 50
USDCHF: Buy 0.9025 SL 20 TP 50
USDCAD: Buy 1.3725 SL 20 TP 55
Gold: Watch out for support at 2285
Trading Idea: Shorting GBPJPY Amid Conflicting Signals from JapaThe recent statement from Japan's Finance Minister about possibly giving up FX intervention due to its ineffectiveness, which seems to suggest acceptance of the yen's continuous weakness, directly conflicts with recent BOJ communications.
Considering this, shorting GBPJPY becomes a highly volatile decision. Nonetheless, a trade is a trade. If this trade goes well, profits are expected within 2 hours. If not, that's part of the game.
Trade Setup:
Short GBPJPY
Entry : 202.97
Stop-Loss : 203.21
Target 1 : 202.60
Target 2 : Open
Strategy:
- Volatility Consideration : Acknowledge the high volatility due to conflicting statements from Japan’s Finance Minister and BOJ.
- Risk Management : Set stop-loss at 203.21 to manage potential losses.
Profit Targets :
Target 1 : 202.60
Target 2 : Keep open
Remember to breathe and prepare for the next trade. What’s your take on this situation? Do you see a different angle or strategy? Share your thoughts and insights below!
USDJPY Analysis and Trade OpportunitiesLike I mentioned in our weekend live session, I don't see any BOJ intervention happening soon.
The earliest I’m looking is when the market reaches 158.73, with the next level at 159.66.
Around 157.74 is the level I'll be looking for a buying opportunity using the existing strategy that I've used for many years.
Key Levels:
Potential Intervention Levels :
- 158.73
- 159.66
- Buying Opportunity : Around 157.74
Shorting Opportunities :
1-Hourly Chart :
- Bearish Bat Pattern Completion : 158.15
- ABCD Pattern Completion : 158.39 if the Bearish Bat Pattern does not complete
Strategy :
- Buying at 157.74 : Use the tried and tested strategy that has worked over the years.
- Shorting Opportunities : Monitor the 1-hourly chart for potential Bearish Bat Pattern at 158.15 and ABCD Pattern at 158.39.
What’s your trade plan for USDJPY? Any valuable insights you’d like to share? Comment down below.
Levels discussed during livestream 14th June14th June
DXY: test resistance area of 105.60-105.70. (could retrace briefly due to end of week) Breaking resistance could trade up to 106.40
NZDUSD: Sell 0.6130 SL 20 TP 50 (Hesitation at 0.61)
AUDUSD: Sell 0.6565 SL 25 TP 70
USDJPY: Buy 158.40 SL 50 TP 100
GBPUSD: Wait for reaction at 1.2690
EURUSD: Sell 1.0705 SL 30 TP 90 (Hesitation at 1.0670)
USDCHF: No setup for now
USDCAD: Sell 1.3770 SL 30 TP 85
Gold: Likely to range between 2340 and 2290
Could the USDJPY retest 160?When the BoJ increased interest rates in March, for the first time in 17 years, the Yen continued to weaken due to the perceived lack of commitment toward further rate hikes.
In April the BoJ kept rates on hold at 0.10%, which saw the Yen react with further weakness.
The BoJ is due to release its Policy Rate and Monetary Policy Statement tomorrow (Friday).
With the USDJPY currently at the 157.25 price level, a resumption of strength on the DXY following the FOMC decision yesterday could see the USDJPY climb up to the resistance level of 158 before the BoJ decision.
If the BoJ decides to keep rates on hold and not take any further action on reducing its bond purchases, the Yen could weaken further, pushing the USDJPY higher toward the all time high of 160.
This is likely to make it very interesting as it would reignite the speculation of a possible currency intervention from the BoJ
Japan rate decision Friday: A deeper look Japan's wholesale inflation surged in May at the fastest annual rate in nine months, data revealed yesterday, indicating that a weak yen may be exerting upward pressure on prices by increasing the cost of raw material imports. Producer prices in Japan rose 2.4% year-on-year in May 2024, up from 1.1% in April, surpassing market expectations of a 2% rise.
This data is likely to be a key factor for the Bank of Japan (BOJ) board as it convenes for a two-day policy meeting ending on Friday. The central bank is widely anticipated to maintain its short-term interest rate target within the 0% to 0.1% range.
However, the data adds complexity to the BOJ's decision-making on the timing of interest rate hikes. BOJ Governor Kazuo Ueda has stated that the central bank will consider raising rates further if it becomes more confident that underlying inflation will remain around the 2% target.
Looking at the 4-hour chart today, the USD/JPY has rebounded following the FOMC decision, erasing much of the post-CPI drop, and passing through the 20-, 50-, 100-, and 200-hour Exponential Moving Averages.
Bearish Deep Gartley Pattern w BOJ DecisionFor those who favor counter-trend trades or believe in a potential BOJ intervention, the Bearish Deep Gartley Pattern on the 1-hourly chart is worth your attention.
1-Hourly Chart:
- Key Level: This pattern provides an excellent risk-reward ratio for shorting opportunities.
Reminder:
- Don’t overtrade.
- Always conduct your own analysis and avoid blindly following others.
What's your trade plan for USDJPY? Comment down below and share your insights!
Happy trading!
USD/JPY calm as GDP within expectationsThe Japanese yen is calm on Monday. In the North American session, USD/JPY is trading at 156.91, up 0.09% on the day at the time of writing.
Japan’s GDP declines
Japan’s economy contracted in the first quarter with a weak reading of -1.8% y/y,
following a revised 0.4% gain in Q4 2023. This was slightly higher than the market
estimate of -1.9% and the initial estimate of -2.0%. On a quarterly basis, GDP declined
by 0.5%, in line with expectations. This followed a small gain of 0.1% in the fourth
quarter. The weak GDP data follows a soft household spending release last week, which
showed decline of 1.2% m/m in April.
The Bank of Japan meets on June 14th and is not expected to raise interest rates, after a
historic rate hike in March. This was the first rate hike since 2007 and a clear shift away
from the BoJ’s ultra-loose monetary policy. There is speculation that the BoJ might
discuss reducing its purchases of Japanese government bonds in an effort to unwind
monetary policy in order to shore up the ailing Japanese yen.
Strong US nonfarm payrolls boost US dollar
Friday’s US nonfarm payroll report was hotter than expected and provided a boost to the
US dollar against all the major currencies, including the yen. Nonfarm payrolls in May
rose to 272 thousand, blowing past the market estimate of 185,000 and much stronger
than the revised gain of 165 thousand in April. Wage growth accelerated in May and was
also higher than expected. Surprisingly, the unemployment rate crept up to 4%, up from
3.9% in April and above the market estimate of 3.9%.
The strong job numbers have helped cushion the impact on the economy of high rates and
that has kept inflation stubbornly high. According the CME’s MarketWatch, the odds of a
quarter-point cut in September have dropped to 46%, compared to 51% just one week
ago. There is virtually no chance of a rate cut at this week’s meeting, but investors will be
very interested in what the Fed has to say.
There is resistance at 157.52 and 158.28
156.33 and 155.57 are providing support
USD/JPY as BOJ rate decision approaches The US federal Reserve is not the only major central bank making an interest rate decision this week. So too, will the nonconformist Bank of Japan (BOJ).
In its April policy meeting, the BOJ highlighted upside risks to inflation and indicated readiness to adjust monetary policy, if necessary, although it expects to maintain its current policy for the time being.
The BOJ stated that if the outlook for economic activity and price rises materializes, interest rate hikes could be warranted. Key economic reports from Japan prior to this week's interest rate decision include:
Japan GDP Growth Rate (final)
Japan Economy Watchers Survey Outlook
Japan Producer Price Inflation
For the exact date and time of these major economic events, import the BlackBull Markets Economic Calendar to receive alerts directly in your email inbox.
From the daily chart, the USD/JPY perhaps appears slightly bullish. The pair has climbed above the Ichimoku Cloud, indicating strong buyer momentum.
On Tuesday last week, BOJ Deputy Governor Ryozo Himino expressed concerns about the negative impact of a weak yen on the economy. His comments suggest that the BOJ might be preparing for another intervention in the forex markets to support the yen, which would be negative for the USD/JPY pair.
The 14-day RSI has recently pulled back, avoiding overbought conditions.
USD/JPY steady despite soft household spendingThe Japanese yen is calm on Friday. In the European session, USD/JPY is trading at 155.50, down 0.06% on the day at the time of writing.
Japan’s economic activity has been sluggish and household spending, a key driver of economic growth, declined by 1.2% m/m in April. This followed a 1.2% gain in March and was well short of the market estimate of 0.2%. On a yearly basis, household spending rose 0.5%, up from -1.2% but short of the market estimate of 0.6%.
Japanese households have been curbing spending as inflation is high and economic conditions remain gloomy. On Monday, we’ll get a look at Japan’s GDP for the first quarter and the forecast is not looking good. The economy is expected to have contracted by 0.5% q/q in Q1 after no growth in the fourth quarter of 2023. This would point to the economy barely avoiding a recession. On an annualized basis, the economy is expected to have declined by 2% after a gain of 0.4% in the fourth quarter.
The Bank of Japan meets on June 14th and a weak GDP report could complicate plans to tighten policy. The BoJ has hinted that it will continue on the path to normalization but if the central bank doesn’t make any moves at the June meeting, the weak Japanese yen could lose more ground.
In the US, the week wraps up with the nonfarm payrolls report for May. This release is one of the most important events on the data calendar but has found itself overshadowed by inflation releases. Still, nonfarm payrolls is a market-mover that can have a significant impact on the US dollar. The market estimate stands at 185,000 for May, little changed from the 175,000 gain in April.
USD/JPY tested resistance at 155.81 earlier. Above, there is resistance at 156.21
155.19 was tested in support earlier. The next support level is 154.74
Japan’s Q1 GDP Falls Faster Than Expected• Japan’s Q1 GDP falls faster than expected
• Data raises questions about when the BOJ will lift interest rates.
• Yen's weakness complicates picture for BoJ
• Japan's real wages fell for a 24th consecutive month
Japan's economy fell faster than expected in the first quarter. Preliminary gross domestic product data from the Cabinet Office on Thursday showed Japan's economy shrank -2% annualized in January to March from the prior quarter, faster than the 1.5% drop seen in a Reuters poll of economists.
In the first quarter of this year, private consumption, which is the largest component of GDP, dropped by an annualized -2.7% from the previous three-month period. Corporate investment fell -3.2%. Exports fell 18.7%, while imports also fell -12.8%, resulting in a decline in net exports. Private residential investment dropped -9.8% from the previous quarter.
Downwardly revised data showed GDP barely grew in the fourth quarter of 2023, due to downgrades to capital expenditure estimates.
Japan’s GDP Growth. Source: Japan’s Cabinet Office
Data raises questions about when the BoJ will lift interest rates
The BoJ raised interest rates for the first time since 2007 in March, and persistently high inflation may pave the way for another move. There are signs of a division among ruling Liberal Democratic Party members over whether the central bank should hike again or keep rates low to smooth financing. The BoJ is paying close attention to whether demand-driven inflation, backed by strong wage growth, is taking root in Japan.
Yen's weakness complicates picture for BoJ
A weaker yen has created a two-speed economy in Japan, with the export and tourism sectors broadly benefiting from a more competitive exchange rate. However, households and small businesses are squeezed by inflated costs of imported goods.
The yen's weakness complicates the question of whether the BoJ should maintain its monetary stimulus or continue to unwind it.
• Japan's real wages fall for 24th consecutive month
When real wage growth remains negative, it's hard to expect strong private consumption. The weakening of domestic demand coincides with inflation outpacing wage growth.
This comes despite the annual wage negotiations in the spring between labor unions and management yielding the best outcome in three decades after major companies weighed the impact of the recent bout of cost-push inflation and agreed to hike pay.
Real wage growth, seen as crucial for Japan to completely emerge from its long fight against deflation, has lagged behind price hikes, eroding households' purchasing power as prices for everyday goods have continued rising due to high raw material costs and a weak yen.
The content published above has been prepared by CFI for informational purposes only and should not be considered as investment advice. Any view expressed does not constitute a personal recommendation or solicitation to buy or sell. The information provided does not have regard to the specific investment objectives, financial situation, and needs of any specific person who may receive it, and is not held out as independent investment research and may have been acted upon by persons connected with CFI. Market data is derived from independent sources believed to be reliable, however, CFI makes no guarantee of its accuracy or completeness, and accepts no responsibility for any consequence of its use by recipients.
CADJPY - Wait For The Bears Hello TradingView Family / Fellow Traders,
CADJPY is currently approaching a massive supply zone marked in red.
📉 For the bears to take over again and start the next bearish impulse movement, a break below the last major low in gray is needed.
Meanwhile, CADJPY would be bullish short-term and can still trade higher.
📚 Always follow your trading plan regarding entry, risk management, and trade management.
Good luck!
All Strategies Are Good; If Managed Properly!
~Richard Nasr
BOJ Intervention Again⁉️Hello TradingView Family / Fellow Traders,
EUJPY is currently approaching a massive supply zone marked in red.
For the bears to take over again and start the next bearish impulse movement, a break below the last major low in gray is needed.
Meanwhile, EURJPY would be bullish short-term and can still trade higher.
📚 Always follow your trading plan regarding entry, risk management, and trade management.
Good luck!
All Strategies Are Good; If Managed Properly!
~Richard Nasr
USD/JPY – Yen weakness prompts warning from TokyoThe Japanese yen is down for a third straight day and has declined 1.5% this week. USD/JPY has risen 0.43% on the day and is trading at 155.35 at the time of writing. Early Thursday, the BoJ will release the Summary of Opinions from the April meeting.
Japanese officials remain mum about suspected interventions on the currency markets last week. The yen broke below the 160 line before recovering and surged 3.4% last week. However, the yen’s strength did not take long to dissipate and has dropped below the 150 level today. Previous interventions by Tokyo boosted the yen for only a short time and that appears to be the trend again.
The Bank of Japan and the Ministry of Finance (MoF) weighed into the yen crisis earlier today. BoJ Governor Ueda said the central bank could take monetary action if the yen’s depreciation has a significant effect on prices. Ueda stated his readiness to tighten policy, saying that if inflation was higher than expected, it would be appropriate to adjust interest rates. Ueda’s remarks may be an attempt to provide the yen with a boost by sending a message that further rate hikes are on the table if inflation moves higher.
Finance Minister Suzuki expressed “strong concern” over the weak yen and warned that he was ready to intervene to boost the yen. It seems questionable whether the warning will have much effect. The yen posted strong gains last week after suspected interventions but has already coughed up close to half of those gains. Barring another intervention, the yen could be on its way back to the 160 level.
USD/JPY is testing resistance at 155.35. Above, there is resistance at 155.91
There is support at 155.01 and 154.43
$HYG will get a boost this summer when rates are cut due to BOJI see the BOJ dumping treasuries this summer, which'll force down the USDJPY pair, and increase inflation here at home. When rates go down, borrowing money is easier, especially for junk corporations avoiding default due to decades high interest rates.
Could AMEX:HYG fall back into the box one last time? Absolutely, if the dollar ticks higher after FED hawkishness. But then, AMEX:HYG will catapult.
When HYG is ready I'll give out some options plays to capitalize on the bullish trend.