Source: PaxForex Premium Analytics Portal, Fundamental Insight

New Zealand Building Permits for November increased 0.6% monthly. Forex traders can compare this to New Zealand Building Permits for October, which decreased 2.1% monthly.

Japanese Money Stock M2+CD for December increased 3.7% annualized, and Japanese Money Stock M3 was reported at ¥2,010.9T. Forex traders can compare this to Japanese Money Stock M2+CD for November, which increased 4.0% annualized, and to Japanese Money Stock M3, reported at ¥2,008.2T.

Japanese Preliminary Machine Tool Orders for December increased by 40.5% annualized. Forex traders can compare this to Japanese Machine Tool Orders for November, which increased 64.0% annualized.

Forex traders should also monitor US initial jobless claims and PPI data out of the US, following yesterday’s red hot CPI data, which is expected to have a ripple effect through many currency pairs. US Initial Jobless Claims for the week of January 8th are predicted at 200K, and US Continuing Claims for the week of January 1st are predicted at 1,733K. Forex traders can compare this to US Initial Jobless Claims for the week of January 1st, reported at 207K, and to US Continuing Claims for the week of December 25th, reported at 1,754K.

The US PPI for December is predicted to increase 0.4% monthly and 9.8% annualized. Forex traders can compare this to the US PPI for November, which increased 0.8% monthly and 9.6% annualized. The US Core PPI for December is predicted to increase 0.5% monthly and 8.0% annualized. Forex traders can compare this to the US Core PPI for November, which increased 0.7% monthly and 7.7% annualized.

The forecast for the NZD/JPY turned bearish after this currency pair was rejected by its flatlining Ichimoku Kinko Hyo Cloud. It has now reversed inside the cloud from where a second rejection is expected. Confirming the lack of upside pressure are the Kijun-sen and the Tenkan-sen, which both turned sideways. The CCI drifts higher and may graze the 100 level or briefly spike into extreme overbought territory before an accelerated contraction may follow. Traders should wait for a reversal in the uptrend before adding their short positions. Cam bears regain control over the NZD/JPY and force a sell-off 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 NZD/JPY remain inside the or breakdown below the 78.400 to 78.900 zone, PaxForex recommends the following trade set-up:

• Timeframe: D1           
• Recommendation: Short Position
• Entry Level: Short Position @ 78.600
• Take Profit Zone: 75.950 – 76.650
• Stop Loss Level: 79.200

Should price action for the NZD/JPY breakout above 78.900, PaxForex recommends the following trade set-up:

• Timeframe: D1           
• Recommendation: Long Position
• Entry Level: Long Position @ 79.200
• Take Profit Zone: 80.000 – 80.550
• Stop Loss Level: 78.900

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