Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Japanese Domestic Corporate Goods Price Index for January decreased by 0.5% annualized. Economists predicted a decrease of 0.4%. Forex traders can compare this to the Japanese Domestic Corporate Goods Price Index for December, which decreased by 0.3% annualized.
The German IFO Business Climate Index for February is predicted at 90.5. Forex traders can compare this to the German IFO Business Climate Index for January, reported at 90.1. The German IFO Current Assessment Index for February is predicted at 89.0. Forex traders can compare this to the German IFO Current Assessment Index for January, reported at 89.2. The German IFO Expectations Index for February is predicted at 91.8. Forex traders can compare this to the German IFO Expectations Index for January, reported at 91.1.
The forecast for the EUR/JPY turned bearish after its recent push higher. Complacency about the Covid-19 mutations poses the most significant risk and can cause a new spike in infections. Government debt resulted in a rise in retail sales, while the labor market continues to show weakness, combining for a toxic economic mix. After price action moved above its Ichimoku Kinko Hyo Cloud, the Kijun-sen flatlined with the Tenkan-sen expected to follow suit. The CCI exited extreme overbought territory and has a clear path to the downside. Will bear force the EUR/JPY into its next horizontal support area inside the narrowing Ichimoku Kinko Hyo Cloud? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the EURJPY remain inside the or breakdown below the 127.700 to 128.450 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 128.050
- Take Profit Zone: 125.700 – 126.150
- Stop Loss Level: 129.050
Should price action for the EURJPY breakout above 128.450 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 129.050
- Take Profit Zone: 130.000 – 130.150
- Stop Loss Level: 128.450
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