Current trend

Yesterday, the USD/JPY pair rose amid comments of Fed’s representative Richard Clarida, who supported the gradual rate increase. USD growth was prevented by a slowing of Housing Price Index increase: it increased by 0.2% against the forecast of 0.4%.

Due to a lack of significant releases, the movement of the yen is technical, exposed to ambiguous factors. JPY strengthens against European currencies being used as a “shelter asset” from Brexit shocks. However, the possibility of introducing new US tariffs against Chinese exports weakens JPY against USD. According to Moody's, the Japanese economy, especially the automotive sector, is under pressure of the US-Chinese trade conflict. Next year, the profits of companies will start to decline significantly.

Today Q3 US GDP data will be published. According to forecasts, the figure will stay at the same level of 3.5%. Also, investors are waiting for the speech of Fed Chairman Jerome Powell at 19:00 (GMT+2), high volatility is predicted.

Support and resistance

On the 4-hour chart, the instrument grows along the upper border of Bollinger bands, the price range is widened, which indicates a possible development of the upward trend. MACD histogram is in the positive region, the signal line crosses the body of the histogram upwards, forming a signal to open long positions.

Resistance levels: 114.00, 114.10, 114.20, 114.30.

Support levels: 113.73, 113.65, 113.55, 113.39, 113.19, 112.93, 112.70, 112.55, 112.44, 112.30, 112.18.

Trading tips

Long positions can be opened from the current level with the target at 114.30 and stop loss 113.55. Implementation period: 1–3 days.

Short positions can be opened from the level of 113.20 with the target at 112.70 and stop loss 113.55. Implementation period: 3–5 days.

US Dollar vs Japanese Yen

BuySellSpread
113.448113.334114

Scenario

TimeframeDay's Range
RecommendationsBUY
Entry Point113.76
Take Profit114.30
Stop Loss113.55
Support levels112.18, 112.30, 112.44, 112.55, 112.70, 113.19, 113.39, 113.55, 113.65, 113.73, 114.00, 114.10, 114.20, 114.30

Alternative scenario

RecommendationsSELL STOP
Entry Point113.20
Take Profit112.70
Stop Loss113.55
Support levels112.18, 112.30, 112.44, 112.55, 112.70, 113.19, 113.39, 113.55, 113.65, 113.73, 114.00, 114.10, 114.20, 114.30
USD/JPY: general analysis

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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