The world of currency trading has been on extreme volatility so far this year because of all the financial crisis major economies have been experiencing. So if you ask me what currency has been performing well, 2 answers come to mind. One is the Swiss franc and the other is the Japanese yen. In this section, I’ll talk about the latter. [Read more...]
The Year Of The Japanese Yen
Scored Some On The GBPJPY
Hi FX fellas! Here’s an update on my latest GBPJPY short. [Read more...]
Opportunity To Short The British Pound Against The Japanese Yen
Hello FX friends! It’s been a while since my last forex trade. But don’t worry since I already have a [Read more...]
Earthquake And Tsunami Jolted The Japanese Yen
Last Friday, an 8.9 magnitude shocked the northeast coast in Japan which generated a gigantic tsunami that swept cities and killed thousands. We, at LaidTrades.com, offer our prayers to Japan especially those who are gravely affected by the disaster. [Read more...]
Is USD/JPY’s Rally Over?
After hitting a low of 81.08 last February 4, the USD/JPY pair has rallied back to mark a high of 83.97 2 days after Valentine’s day. [Read more...]
A Triangle Seen In The US Dollar Against The Japanese Yen!
Hello forex peeps! What I have here on the canvass is the daily chart of the US dollar versus the Japanese yen (USD/JPY). Last May, the [Read more...]
US Dollar Seen to Rally Against the Japanese Yen
So after being routed by Japanese yen for the last three years, it seems like the US dollar‘s recent rally will extend at least in the near term. Earlier today, the Bank of Japan, which is headed by Governor Masaaki Shirakawa, decided to keep its interest rate unchanged for the foreseeable future to encourage spending. Japan’s core consumer price index, which measures the change in the price of goods and services consumed minus the price of fresh food, remains stuck at -0.6%. A decrease in prices suggests that overall consumption in the country is very [Read more...]
US Dollar Trading At An All-time Low Against the Japanese Yen!
Happy Halloween FX fiends, I mean friends! Indeed, it is very scary at least for the USD as it is now trading at a new historical low versus the Japanese yen. To end the week, the USDJPY surpassed its former all-time low at 80.43 which it set way back in April 1995 and closed at 80.38. As you can see from its weekly chart, the pair has been on a long term downtrend since the latter part of 2007. Based on the Elliot Wave Principle, where prices move in a 5-wave cycle before correcting, the USDJPY pair could be on the final leg of its wave B. If my wave counting is correct, then the pair could rebound for awhile in the coming week or so, marking its wave C, before heading back south to start a new down wave. Given its oversold condition, it could, however, rally until it encounters some resistance at 85.00. Still, the pair would more likely be on track for some more losses because present trend. In any case, a close below its former low at 80.43 at the end of the month would place some more selling pressure on the greenback.
To end the month of October, the US market closed flat with the Dow ending with a mere 0.04% gain and the broader S&P 500 with a 0.04% loss. The US’s third quarter GDP missed its 2.1% target by a hair with a 2.0% growth. Despite the 2.6% increase in household spending, the country’s overall expansion remains subdued and it expected to be the same at least in the near term which brings the country at the realm of another non-traditional monetary easing by the Federal Reserve.
Speaking of the Fed, it will have its monetary easing meeting this coming Wednesday (November 3). The Fed is widely expected to pump more money in the country’s financial system to support consumer spending. Traders will also be on the look out for the US’s non-farm employment report (NFP) on November 5. US firms are expected to have added about 65,000 jobs during the recent month after cutting 95,000 during the previous period. Both expected results from the upcoming two major economic would be bearish for the greenback. An additional easing by the Fed would dilute the USD while the latter would spark some risk taking among investors. Risk taking, as we have been observing during these periods, would go against the dollar given its low interest rate. Nonetheless, expect some fireworks both in the financial market for the coming week. Stay on your toes!
The Geppy’s Bearish Setup
Hello forex friends! What I have here is the daily chart of the British Pound versus the Japanese Yen (GBP/JPY) or Geppy as its nickname). In my technical analysis, this currency pair is leaning towards the bearish side as it has been declining in a downward channel for a certain time now. Furthermore, there is a descending triangle formation setting up inside the channel and could be bound for a breakdown soon. If the Geppy breaks below the support of the said triangle, the pair could duck dive and tap my conservative target price of 120.00. If it further drops below 120.00, the next marker could be the downward channel’s support. On the bullish note, if the descending triangle seen on the Pound versus the Yen fails to breakdown but instead breaks out on the upside, it could rise and hit my target price of 140.00. This however is less likely to happen as the pattern is coming from a downtrend and descending triangles are naturally bearish. In any case 140.00 gets cleared out, the next resistance could be 145.00.
Swiss Franc, Pausing Before Making Another Move North?
Hiyo FX friends! Here’s my short and sweet technical view on the CHFJPY pair. As you can see from its daily chart, the pair has broken out from a rare inverted head and shoulders continuation pattern. You see, an inverted head and shoulders pattern is generally a bullish reversal pattern although it can occur as a continuation from time to time as in this case. In any case, the upside target for the pair, judging by the height of the pattern and projecting it from the point of breakout, would be somewhere below 88.00. Sustained buying interest could push it over to that marker. At present, though, the pair’s move up north could take a halt given its overbought condition. Given this, it is possible for the pair to range or even retrace for awhile. If ever it weakens, the neckline of the previous formation should keep it afloat. Still, I could more or less say that things are looking up for the Swiss franc in the near term. Long Swiss franc anyone?
Australian Dollar To Rise By 10% Against the Yen?
It’s another manic week Forex friends! In today’s FX feature I present to you the daily chart of AUDJPY. As you can see, the pair has recently broken out (upside) from a nice symmetrical triangle formation. This breakout could swing the pair towards its previous high near the 88.00 marker. Projecting the base of the triangle from the point of breakout, the resulting upside target would be at 88.00 as well. The Aussie’s run, however, may be tempered for awhile because conditions are already overbought. The pair could range or retrace shortly before heading north again. And given it’s recent spike, it could potentially form a flag or a pennant pattern. At present, the AUDJPY pair is trading just above 80.00. Therefore, if it reaches 88.00, that would be a sweet 10% gain (1:1 margin).
The recent rally in the global equities market and gold’s rush towards fresh all-time high (see my recent post here) have helped the commodity dollars like the AUD. For this week, no high impact economic reports are due from Australia. The major releases, though, from the US, Canada, and New Zealand would more likely sway the Aussie’s short term movement. The US Fed, of course, will have its monetary policy decision on September 21. Building permits, new and existing home sales plus durable goods orders are due as well from the US. In Canada, the country’s CPI and retail sales accounts are on deck on September 21 and 22. New Zealand, Australia’s neighbor, will likewise publish its second quarter GDP growth. Risk appetite, resulting from one or all the these accounts could benefit the non-dollar currencies like the Aussie. The opposite, however, would weigh on it. Watch out for these reports!
A Bearish Pattern in the AUDJPY – August 31, 2010
Hello forex peeps! For months now, the AUDJPY currency pair has been moving sideways. Apparently it has been setting up a triangle formation in its daily chart and could be bearish as it came from a downtrend four months ago. So is the AUDJPY currency pair bound to go lower? I would say “yes” once it breaks below the current support line (red line). If it does, it could head all the way down and test the 70.00 psychological support (black line) until it further drops again. On the upside, if AUDJPY manages to climb up, it could first test its current resistance (blue line). Once that hurdle get cleared out, there could be some selling pressure at the next resistance at the 80.00 psychological area.
Is the Euro-Yen Poised for Another Drop? – June 25, 2010
Hello peeps! I haven’t much about the EURJPY as of late so here it is now. On its daily canvas, you can see that it has failed to move past the resistance around 113.40 for the last couple of weeks. Interestingly, this mark happens to fall in line almost perfectly with the 38.2% Fibonacci retracement level that I drew. Presently, the pair is trading around 110.00. In my view, it is on track to meet its 2010 low again. A presence of a bearish divergence, where the price registers lower highs and the stochsastics go higher and higher, also suggest a likely down-move. Judging by the height of its present range, it could fall by another 400 pips if it manages to break the 108.00 support. On the positive note, a break above the 38.2% Fib could send it a bit higher towards to 50% level.
The general prices of equities and currencies generally have been stuck within a range this week due to the mixed results from the economic data that came out of the US. US home sales were and durable goods were actually unexpectedly weaker than anticipated which added some concerns that the present global recovery is not that strong as initially thought. In any case, no other major economic reports are on deck today as the US leaders already managed to agree on their plan to overhaul the country’s financial system. The US’s final GDP for the 1Q is set to be released to no changes on the previous tally are expected. If, however, the account surprises us on the downside, the safer currencies like the yen and the USD would likely get some favor from the traders. If not, most major pairs would more likely just trade in a range until they sway in either direction in the coming week.
NZDJPY Symmetrical Triangle Breakout – June 21, 2010
The NZDJPY currency pair in the 1-hour chart has broken out (red circle) from a symmetrical triangle formation earlier and shot up more than 100 pips. Still, the New Zealand dollar could further rise over the Japanese yen since its minimum upside target, which is gauged by projecting the height of the triangle from the point of breakout, has not yet been met. However, there is a noticeable resistance at 65.31 (indicated by the green line). Once the 65.31 price mark is breached, the NZDJPY could climb to 66.00. On the downside, once the price slips below the 64.85 support (indicated by the blue line), it could slide all the way down to 64.00.
The Geppy Breaking Out? – June 16, 2010
The GBPJPY (Geppy) could be on its way from breaking out from the symmetrical triangle in the 3-hour chart (indicated by the red circle). Once the price breaks above the resistance at 136.00, the currency pair could head all the way up to the 138.00 territory which could be the next resistance (green line). However, if the selling pressure dominates the 136.00 level, the Geppy can go back to its immediate support (brown line) at the 134.50. If 134.50 still couldn’t hold on to the value of the British Pounds against the Yen, the retreat could be at the next support (purple line)
The CADJPY Trading Range – June 8, 2010
One way to check the stability of a government is through its currency value and that is what’s being reflected by the Canadian economy. Despite the bad news coming in from different markets, the Canadian Dollar against other currencies remain to be stable. Well, at least since 2009.
In the chart of the Canadian Dollar vs Japanese Yen (CADJPY), there is a trading range (indicated by the yellow lines) that was formed back in March of 2009. Currently the currency pair is at the 86.00 area and could move just within the range for the next couple of months. However, if the value goes beyond the resistance or support then that’s a different story. A break above the resistance could propel the CADJPY to reach new highs for the year, but then, it needs to surpass the 94.48 price mark (blue line). On the other hand, a break below the current support could slide the value to the next support at 79.92 (red line). If the currency maintains to move within the trading range, then we would see the value to be just around 82.00-94.00.
The Pound Got Pounded – June 8, 2010
Here’s an update on the guppy (GBPJPY). In my last post about the pair, I noted that it could find some resistance at the 61.8% Fibonacci retracement level that I marked on its old chart. It, however, suprpassed that price (135.00) and reached 136.00 before turning around. When I readjusted my swing high to April 26′s high, I noticed that the 136.00 price then fell in line with the 50% Fib of the new retracements. At present, the pair already broke below the 132.00 support. If it succesfully clears 131.00, it could very well revisit its 2010 low once more. Though, in my view, this level could be broken any time soon since the stochastics are still far from the oversold region. Otherwise, it could trade for awhile within a range before swinging in either direction.
Perhaps we all know now the reason behind the recent beating that the pound received. Well, for those who do not know, the sterling pound got pounded late Friday night when Hungarian officals commented on a possibility of a sovereign debt default. This news, to nobody’s suprise, sparked some risk aversion in the markets which was further intensified when the latest US NFP report printed a weaken than projected employment change.
For the coming days, in my view, the pound would be more sensitive to the developments in the euro zone rather than from the UK itself. Though, if the BOE’s decides to keep its asset purchase facility and interest rate unchanged, it could then add to the pound’s already weakend state. The Bank of England’s monetary policy decision, by the way, will be held on Thursday (June 10). So stay tune!
The Pound to Turn South Again? – June 3, 2010
Good day forex friends! On today’s chart spotlight is the daily time frame of the guppy (GBPJPY). As you can see, buyers have bought up the British pound after it had fallen to a low of 126.731 against the Japanese yen. The pair has since retraced after finding some support at 128.00 and at the bottom of the channel. At present, the pair is trading around 135.00 though in my view it could soon reverse and head back down. Why? Well, the 135.00 psychological resistance is almost in line with the 61.8% Fibonacci retracement level, making it a tougher hurdle to overcome. Moreover, the stochastics are indicating that conditions are almost overbought. This suggests that sellers could soon jump in to push the pair low. If and when the GBPJPY moves past the 135.00 level and the 61.8% Fib, it could continue moving north until it hits a wall at 139.00 or at the channel’s top. On the dimmer note, the pair could once again turn south back to 129.00 or even at the descending channel’s support if the pound selling resumes.
The GBPJPY pair has rebounded from its 2010 low thanks to some profit taking actions or short covers and the recent weakness in the JPY. The yen’s recent decline was due to the political turmoil in Japan. Just yesterday, Prime Minister Yukio Hayotama resign from his position after receiving a lot of criticisms from the government’s opposition and even its political ally, the Social Democratic Party, when the former unduly fired Mizuho Fukushima, the leader of the said party, when she disagreed with the former’s decision to move a US military base to a different location. The disagreement between the two led the Social Democratic Party to sever its allegiance with the government. Receiving a lot of pressure from majority of Japan’s citizen, the Prime Minister was then forced to resign. This has left the country searching for a new leader with a vision. Now, risk appetite in the Japanese market could soon return when the country places a new front-man in its government. Once this happens, the yen could then regain its appeal.
Outside Japan, the market’s sentiment remains bearish because of several factors like the ongoing debt crisis in Europe, threat of a Korean War 2.0, and the devastating oil spill in the US. These issues are dead proofs that the global market is still far from being stable. Until the stands up and recovers its footing, periodic weakness could still be felt among the non-dollar currencies like the pound which consequently benefits the safer ones like the JPY.
CADJPY’s Symmetrical Triangle – June 2, 2010
The CADJPY currency pair looks to be forming a symmetrical triangle formation in the hourly. If the pair break’s above the triangle’s resistance, its price could reach the next significant level at 88.67. On the other hand, a breakdown from the pattern could send it down to the support at 85.83. Still, the pair has a higher chance of breaking to the upside since the pattern is coming off an uptrend. In any case, to be a little conservative, I would wait for a breakout in either direction before opening a position. A straddle strategy would work better in this kind of situation where I would sell the Japanese yen in exchange of the Canadian dollar if the pair breaks up. Conversely, I would sell Loonie for the JPY if and when the pair breaks down.
GBPJPY Breaking Down? – June 1, 2010
The GBPJPY looks to be breaking below (indicated by the red circle) the support line of the uptrend in the 1-hour chart. Though as of now, the uptrend support appears to be keeping the pair from falling further. If the guppy slides below 131.50, the pair could head all the way down to 130.50 which is a previous resistance-turned-support. On the positive side, a bounce from 131.50 could propel the pair up to the triangle resistance just above 132.50. In my view, it has a higher chance of breaking up than breaking down given its present uptrend. If and when it breaks out to the upside, it could aim for 135.00 which its minimum upside judging by the height of the triangle.
