Technical analysis of USD/JPY for January 20, 2014
January 20, 2014 4:15 pm
Overview: USD/JPY is expected to trade in lower range. Liquidity is thin in global day as financial markets in U.S. are shut for holiday. USD/JPY is undermined by selling of yen crosses amid diminished investor risk appetite (S&P fell 0.39% Friday) on disappointing U.S. corporate earnings, surprise drop in University of Michigan preliminary consumer sentiment index to 80.4 in January from 82.5 in December (defying forecast for rise to 83.5) and lower U.S. Treasury yields. But USD/JPY losses are tempered by the broadly stronger dollar undertone (ICE spot dollar index last 81.21 versus 80.91 early Friday), demand from the Japan importers and ultra-loose Bank of Japan’s monetary policy. Yen crosses are also vulnerable to China December retail sales, industrial output and fixed assets investment data.
Technical comment: Daily chart is mixed as MACD is bearish, but stochastics is neutral.
Trading recommendation:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. A short position is recommended with the first target at 104.05 in mind. A breach of this target will move the pair further downwards to 103.8. The pivot point stands at 104.45. In case the price moves in the opposite direction, it bounces back from support, and moves above its pivot point, the price is most favourably expected to move further to the upside. In that scenario, a long position is recommended with the first target at 104.65 and the second target at 105.05.
Resistance levels: 104.65 105.05 105.45
Support levels: 103.8 103.5 103.2
The material has been provided by InstaForex Company – www.instaforex.com
Overview:
USD/JPY is expected to trade in lower range. Liquidity is thin in global day as financial markets in U.S. are shut for holiday. USD/JPY is undermined by selling of yen crosses amid diminished investor risk appetite (S&P fell 0.39% Friday) on disappointing U.S. corporate earnings, surprise drop in University of Michigan preliminary consumer sentiment index to 80.4 in January from 82.5 in December (defying forecast for rise to 83.5) and lower U.S. Treasury yields. But USD/JPY losses are tempered by the broadly stronger dollar undertone (ICE spot dollar index last 81.21 versus 80.91 early Friday), demand from the Japan importers and ultra-loose Bank of Japan’s monetary policy. Yen crosses are also vulnerable to China December retail sales, industrial output and fixed assets investment data.
Technical comment:
Daily chart is mixed as MACD is bearish, but stochastics is neutral.
Trading recommendation:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. A short position is recommended with the first target at 104.05 in mind. A breach of this target will move the pair further downwards to 103.8. The pivot point stands at 104.45. In case the price moves in the opposite direction, it bounces back from support, and moves above its pivot point, the price is most favourably expected to move further to the upside. In that scenario, a long position is recommended with the first target at 104.65 and the second target at 105.05.
Resistance levels:
104.65
105.05
105.45
Support levels:
103.8
103.5
103.2
The material has been provided by InstaForex Company – www.instaforex.com
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