Technical data of the currency pair:

Previous closing: 109.24;
Daily range: 109.17-109.46;
Opening: 109.24;
52- week range: 105.52-125.86;;
Annual revenue: -10.11%;
Change in % for the previous day: -0.59.

Analytical review:

  • Since the beginning of May the Yen has dropped over 400 points against the USD. During last Friday’s session, the rally in the USD was stopped by the resistance level of 110.65;
  • Yesterday, important Japanese statistics was released, which showed that trade balance in April amounted to 823.5 billion JPY against the forecast of 493 billion JPY;
  • Demand for the JPY is supported by the decline in Japanese stock market (index Nikkei fell by over 1%) and the decrease of expectation of the future intervention to the currency market by the Bank of Japan;
  • “Commitments of Traders” show ambiguous picture. Large speculators show the decline in long positions by 478 contracts. Number of short positions fell by 2816 contracts;
  • Statistics of this week will include the data on sales of new homes in the USA (today) and US GDP (Friday). This data may affect market volatility and currency movement.

Summary:

  • Japanese currency is supported by the data on Japanese trade balance, negative dynamics of the stock market;
  • According to “СОТ” large investors do not have common opinion about the Yen;
  • Therefore, it is likely that the Yen will grow against the USD. It is recommended to open short positions.

Trading tips for the currency pair USD/JPY

Key levels:
Support levels: 108.00 and 106.45.
Resistance levels: 109.65 and 110.65.

Medium-term trading, Н4
Currently, the currency has broken down and consolidated below the local support level of 109.65. If the price maintains the mirrored resistance level of 109.65 and in case of the respective confirmation (such as Price Action pattern) it is advisable to open short positions. Risk per trade is not more than 2% of the capital. Stop order can be placed slightly above the signal line. Take profit can be placed in parts at the levels of 108.35, 107.15 and 106.50 with the use of trailing stops.

Medium-term trading, Н4
Medium-term trading, Н4

Short-term trading, М15
The currency is traded in the range of 109.15-109.45. We suggest to enter the market after breaking out and testing of this zone. Positions can be opened towards the signal line and the nearest support/resistance level. Risk per trade is not more than 3% of the capital. Stop order can be placed slightly above/below the signal line. Take profit can be placed in parts of 50%, 30% and 20% with the use of trailing stops.

Short-term trading, М15
Short-term trading, М15




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