- SWFX market sentiment is 54% bullish
- 52% of pending orders in the 100-pip range are bullish
- Notable support near 110.00
- US GDP and Durable Goods at the end of the week
On Tuesday the currency exchange rate remained near previous levels, as the pair was heading to the upper trend line of a medium scale channel down pattern. Due to that reason a short lived surge was expected to end in the near future.
The USD/JPY exchange rate depreciated 23 base points to the 110.68 level, following the BoJ monetary policy statement and the outlook report. Though, the pair managed to recover in the next couple of hours to be above the 111.00 mark, as the Bank's Governor made dovish remarks, sending rate higher.
The Bank of Japan kept the interest rate unchanged at a negative 0.10%, as widely anticipated, offering a more optimistic view on consumer inflation projections, underscoring the conviction that the Japan economy was making moderate, but steady progress to the 2% CPI growth target. Later, the BoJ Governor Haruhiko Kuroda indicated that the Bank was not in a position to consider the QEE quit.
US data release on Friday
As today the Bank of Japan event occurred, the focus for swing traders is shifting to another release.
On Friday the Advance GDP of the United States will be published at 13:30 GMT. The GDP will be accompanied with the US Durable Goods data sets at the same time.
USD/JPY shows mixed signals
USD/JPY was struggling to move past the 100-hour SMA and the weekly PP during the first half of Monday. However, strong hourly surge mid-session resulted in a breakout of the aforementioned levels and the 55– and 200-hour SMAs.The Yen strengthened early today in the wake of BOJ comments about upbeat inflation outlook. This fundamental advantage, however, did not hold strong, as the US Dollar returned to test yesterday's peak of 111.15.
The pair being located above all three SMAs flashes bullish signals; however, other indicators favour a decline in price. In case this bearish scenario occurs, the Greenback should be limited by the monthly S2 and the weekly S1 circa 110.20.
Conversely, the prevalence of bulls would send the rate for a test of the weekly R1 and the monthly S1 near 111.50.
Hourly chart
A review of the daily chart has been conducted. It has been discovered, that by using the low levels of candles to set the support line of the long term channel down instead of the candle tails, the picture is different.
The currency exchange rate has already touched the lower trend line of the dominant channel down pattern. Due to that reason, the short term channel of the hourly chart might be broken in the near future.
Daily chart
SWFX traders are on the long side, as 54% of open positions were bullish. Meanwhile, 60% of pending orders are to buy the Greenback.
The market sentiment of OANDA traders remains bullish with 66% long positions (+4%). Meanwhile, Saxo Bank clients are likewise bullish, as 55% (-5%) of open positions are long
Spreads (avg, pip) / Trading volume / Volatility