Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Japanese Trade Balance for April came in at -¥462.5B, and the Japanese Adjusted Trade Balance at -¥0.56T. Economists predicted a reading of -¥339.5B and -¥0.72T. Forex traders can compare this to the Japanese Trade Balance for March, reported at ¥366.5B, and the Japanese Adjusted Trade Balance at -¥0.70T. Exports for April surged by 8.3% annualized, and Imports accelerated by 8.3% annualized. Economists predicted an increase of 11.1% and 9.0%. Forex traders can compare this to Exports for March, which rose by 7.3% annualized, and Imports, which dropped by 4.9% annualized.
Japanese Machine Orders for March rose 2.9% monthly and 2.7% annualized. Forex traders can compare this to Japanese Machine Orders for February, which surged by 7.7% monthly and decreased by 1.8% annualized.
The Japan Reuters Tankan Index for May came in at 9. Forex traders can compare this to the Japan Reuters Tankan Index for April, reported at 9.
The UK CPI for April is predicted to increase 0.2% monthly and 2.1% annualized. Forex traders can compare this to the UK CPI for March, which rose 0.6% monthly and 3.2% annualized. The Core CPI for April is predicted to expand 0.7% monthly and 3.6% annualized. Forex traders can compare this to Core CPI for March, which increased 0.6% monthly and 4.2% annualized.
The UK PPI Input for April is predicted to rise by 0.4% monthly and decrease by 1.2% annualized. Forex traders can compare this to the UK PPI Input for March, which contracted by 0.1% monthly and 2.5% annualized. The UK PPI Output for April is predicted to rise by 0.4% monthly and by 1.2% annualized. Forex traders can compare this to the UK PPI Output for March, which increased by 0.2% monthly and 0.6% annualized.
The UK RPI for April is predicted to rise by 0.5% monthly and 3.3% annualized. Forex traders can compare this to the UK RPI for March, which increased by 0.5% monthly and 4.3% annualized.
UK Public Sector Net Borrowing for April is predicted at £18.50B. Forex traders can compare this to UK Public Sector Net Borrowing for March, reported at £11.02B.
The forecast for the GBP/JPY remains cautiously bearish, with Bank of Japan intervention looming. The Kijun-sen has flatlined, but the Tenkan-sen moves higher following a bullish crossover. The Senkou Span A of the Ichimoku Kinko Hyo Cloud is descending, approaching a bearish crossover below the flat Senkou Span B. Traders should also monitor the CCI after forming a negative divergence in extreme overbought territory. A breakdown below 100 could trigger a sell-off. Can bears regain control over the GBP/JPY and force price action 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 GBP/JPY remain inside the or breakdown below the 198.250 to 198.900 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 198.700
- Take Profit Zone: 192.900 – 194.250
- Stop Loss Level: 199.500
Should price action for the GBP/JPY breakout above 198.900, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 199.500
- Take Profit Zone: 200.000 – 200.500
- Stop Loss Level: 198.900
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