Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Final Japanese Leading Index for July came in at 108.2, and the Final Japanese Coincident Index at 114.2. Economists predicted a figure of 107.6 and 113.0. Forex traders can compare this to the Japanese Leading Index for June, reported at 108.8, and to the Japanese Coincident Index at 115.6.
US Preliminary Durable Goods Orders for August are predicted to decrease by 0.5% monthly, and Durables Excluding Transportation to increase by 0.1% monthly. Forex traders can compare this to US Durable Goods Orders for July, which plunged by 5.2% monthly, and Durables Excluding Transportation, which rose by 0.5% monthly. Capital Goods Orders Non-Defense Excluding Aircraft for August are predicted flat at 0.0% monthly. Forex traders can compare this to Capital Goods Orders Non-Defense Excluding Aircraft for July, which rose by 0.1% monthly.
US Crude Oil Inventories Change for the week ending September 22nd are predicted at -1.320M. Traders can compare this to US Crude Oil Inventories Change for the week ending September 15th, reported at -2.135M. US Gasoline Inventories Change for the week ending September 22nd are predicted at -0.120M, and US Distillate Stocks Change at -1.298M. Traders can compare this to US Gasoline Inventories Change for the week ending September 15th, reported at -0.831M and US Distillate Stocks Change at -2.867M.
The Japanese Yen approaches the 150.000 level against the US Dollar, which increases the likelihood of an intervention by the Bank of Japan. The US Federal Reserve is close to peak rates, but the Japanese central bank may tweak its policy, which would assist the Japanese Yen in gaining lost ground.
The forecast for the USD/JPY is cautiously bearish as this currency pair challenges the key resistance level of 150.000. The massive 1,200+ pips rally since mid-July shows signs of exhaustion with the Kijun-sen flat, but the Tenkan-sen drifting higher. The Ichimoku Kinko Hyo Cloud confirms the loss of bullishness as the flat Senkou Span B fails to confirm the rise of the Senkou Span A. Traders should also monitor the CCI in extreme overbought territory. A negative divergence has formed, suggesting a potential price action reversal. A breakdown in this technical indicator below 100 could trigger a sell-off, and a drop below zero should accelerate the sell-off. Can bears overpower bulls and take control of price action in the USD/JPY to push this currency pair into its horizontal support area for a healthy correction? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the USDJPY remain inside the or breakdown below the 148.450 to 150.000 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 149.100
- Take Profit Zone: 143.900 – 145.050
- Stop Loss Level: 150.750
Should price action for the USDJPY breakout above 150.000, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 150.750
- Take Profit Zone: 151.500 – 152.250
- Stop Loss Level: 150.000
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