USD/JPY: weak Yen promotes economic growth in Japanese

November 26, 2013

Current trend

Currency pair USD/JPY has grown at the beginning of this week reaching six-month highs at the level of 101.91. The rise in the pair is supported by expectations of phasing out quantitative program in the USA. It is assumed that even in case of the decrease in the volume of American securities. Ultrasoft monetary policy in Japan will be continued. According to Japanese politicians, Abenomics bears fruit: weak Yen helps to regain competiveness of Japanese products; GDP in the country is growing and inflation rate is slowly increasing (although the target level of 2% has not been reached yet).

Support and resistance

Technical indicators show that on Monday the pair broke down the upper limit of the ascending channel and later went back inside its limit. The key level is the moving average line of “Bollinger bands” indicator (101.30). If this level is broken down downward correction can continue to the level of 100.70. However it is most likely that upward movement go on to the level of 101.80 and 102.30. Indicators give mixed signals. Bollinger bands are directed upward and demonstrate narrowing in advance of sharp changes in price. MACD histogram is in the positive zone, its volumes are decreasing. Stochastic lines are directed downward.

Trading tips

In the current situation it is advisable to open positions with profit taking at the level of 102.30. Short positions with the target of 100.70 can be opened if the price breaks down the level of  101.30.

Dmitriy Zolotov
Analyst of LiteForex Group of Companies

Publication source
LiteForex information  LiteForex reviews

October 27, 2016
Daily Technical Outlook for October 27, 2016
The Euro bounced during yesterday after reaching a major support located at 1.0850 in the weekly chart. However, the current recovery can be short-lived as long as prices continue to trade below 1.1040peak, which represents the post-ECB high...
October 27, 2016
Brexit Barometer
The Brexit vote back in June taught markets never to take anything for granted and the same holds true for the upcoming US Presidential election. A poll lead for Trump in Florida yesterday, combined with some further revelations in the daily mud-slinging...
October 26, 2016
Sterling reversal
What we saw in sterling yesterday was instructive of the dilemma that may face other central bankers before long. Carney played down expectations of a further easing in policy before the end of the year, as was strongly suggested in August when they eased policy in the wake of the Brexit referendum...

OANDA Rating
Orbex Rating
Vantage FX Rating
Grand Capital Rating
Larson&Holz IT Ltd Rating
OctaFX Rating

OptionRally Rating
Banc De Binary Rating
OptionFair Rating
EZTrader Rating
Porter Finance Rating
Anyoption Rating