Source: PaxForex Premium Analytics Portal, Fundamental Insight
Foreign Buying of Japanese Bonds for the period ending May 11th came in at -¥396.6B, and Foreigners Buying of Japanese Stocks at ¥660.8B. Forex traders can compare this to Foreign Buying of Japanese Bonds for the period ending May 4th, reported at -¥1,018.4B, and to Foreigners Buying of Japanese Stocks at ¥268.6B.
The Preliminary Japanese GDP for the first quarter dropped by 0.5% quarterly and by 2.0% annualized. Economists predicted a decrease of 0.3% and 1.5% annualized. Forex traders can compare this to the Japanese GDP for the fourth quarter, which was flat at 0.0% quarterly and flat at 0.0% annualized. Preliminary Private Consumption for the first quarter contracted by 0.7% quarterly, preliminary Capital Expenditure by 0.8% quarterly, and preliminary External Demand decreased by 0.3% quarterly. Economists predicted a drop of 0.2%, a contraction of 0.8%, and a decrease of 0.3%. Forex traders can compare this to Private Consumption for the fourth quarter, which decreased by 0.4% quarterly, Capital Expenditure, which increased by 1.8% quarterly, and External Demand, which rose by 0.4% quarterly. The Preliminary GDP Price Index for the first quarter rose 3.7% annualized. Economists predicted a rise of 3.3%. Forex traders can compare it to the GDP Price Index for the fourth quarter, which surged by 3.9% annualized.
Final Japanese Industrial Production for March plunged by 6.2% monthly and rose by 4.4% annualized. Forex traders can compare this to Japanese Industrial Production for February, which decreased by 0.6% monthly and plunged by 3.9% annualized. Capacity Utilization for March rose by 1.3% monthly. Forex traders can compare this to Capacity Utilization for February, which decreased by 0.5% monthly.
The Final Italian CPI for April is predicted to rise 0.2% monthly and 0.9% annualized. Forex traders can compare this to the Italian CPI for March, which was flat at 0.0% monthly and expanded by 1.2% annualized. The Final Italian Harmonized CPI for April is predicted to accelerate by 0.6% monthly and 1.0% annualized. Forex traders can compare this to the Italian Harmonized CPI for March, which rose by 1.2% monthly and 1.2% annualized.
The Italian Trade Balance for March is predicted at €4.770B. Forex traders can compare this to the Italian Trade Balance for February, reported at €6.034B.
The forecast for the EUR/JPY remains cautiously bearish after this currency pair retreated from its horizontal resistance area. Short-term volatility could rise with the Ichimoku Kinko Hyo Cloud and the Kijun-sen flat, but the Tenkan-sen drifting higher. Traders should also monitor the CCI after recording a lower high in extreme overbought territory followed by a breakdown. This technical indicator has plenty of downside potential to drag price action lower. Can bears maintain control over the EUR/JPY and force this currency pair into its horizontal support area? 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 166.900 to 168.400 zone, PaxForex recommends the following trade setup:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 167.600
- Take Profit Zone: 162.600 – 164.000
- Stop Loss Level: 169.200
Should price action for the EURJPY break out above 168.400, PaxForex recommends the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 169.200
- Take Profit Zone: 170.000 – 171.000
- Stop Loss Level: 168.400
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