Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Preliminary Japanese GDP for the second quarter decreased by 7.8% quarterly and by 27.8% annualized. Economists predicted a decrease of 7.6% and 27.2% annualized. Forex traders can compare this to the Japanese GDP for the first quarter, which decreased by 0.6% quarterly and by 2.2% annualized. Preliminary Private Consumption for the second quarter decreased by 8.2% quarterly, preliminary Capital Expenditure decreased by 1.50% quarterly, and preliminary External Demand decreased by 3.0% quarterly. Economists predicted a decrease of 7.1%, 4.2%, and 3.2%. Forex traders can compare this to Private Consumption for the second quarter, which decreased by 0.8% quarterly, to Capital Expenditure, which increased by 1.7% quarterly, and to External Demand, which decreased by 0.2% quarterly.
Final Japanese Industrial Production for June increased by 1.9% monthly and decreased by 18.2% annualized. Economists predicted an increase of 2.7% and a decrease of 17.7%. Forex traders can compare this to Japanese Industrial Production for May, which decreased by 8.9% monthly and by 26.3% annualized. Capacity Utilization for June increased by 6.2% monthly. Forex traders can compare this to Capacity Utilization for May, which decreased by 11.6% monthly.
The Singapore Trade Balance for July was reported at $3.300B. Forex traders can compare this to the Singapore Balance for June, reported at $4.990B. Non-Oil Exports for July increased by 1.2% monthly and by 6.0% annualized. Forex traders can compare this to Non-Oil Exports for June, which decreased by 1.4% monthly, and which increased by 13.9% annualized.
The forecast for the SGD/JPY remains bearish amid the widening Covid-19 pandemic, which keeps safe-haven demand a slowly growing trend once again. As more global economic data is released, the scenario is worse than initially expected. The recovery is also positioned to be slower than early models considered. This currency pair is above its Kijun-sen and Tenkan-sen, but the Ichimoku Kinko Hyo Cloud is flattening, suggesting a pause and potential reversal. Will bears force a sell-off? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the SGD/JPY remain inside the or breakdown below the 77.500 to 77.900 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 77.650
- Take Profit Zone: 75.850 – 76.200
- Stop Loss Level: 78.100
Should price action for the SGD/JPY breakout above 77.900 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 78.100
- Take Profit Zone: 78.500 – 78.800
- Stop Loss Level: 77.900
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