08, October 2015

USD/JPY (a 4-hour chart)

USD/JPY (a 4-hour chart)

General overview

The main event of the day was the Bank of Japan meeting results publication. Mr. Kuroda said that the Bank of Japan's policy is aimed at the exchange rate rather than price. Also, the chief of a Japanese bank noted sustained recovery of the US economy. At the end of the third quarter the Japanese 10 year government bond yields, which reflects investors' expectations about inflation, has fallen by 11.4 bp and now it has been at its lowest level for the last 5 months. Yesterday the US and the Japan government bond yields showed the minimal changes which does not allow to conclude demand for the US or Japanese assets.

The price of the instrument shows the spiral corrective movement. During the day there was bear trend, which is shown by trades on decrease in the corridor 120.40 and 119.20 levels.

The price started its correctional movement.

The price is finding the first support at 119.20, the next one is 118.40. The price is finding the first resistance at 120.40, the next one is at 121.60.

There is a weak sell signal. The price is below the Cloud and it is above the Chinkou Span. The Tenkan-sen shows an upward movement and the Kijun-sen shows a horizontal one.

The MACD indicator is in a positive territory. The MACD is decreasing.

Trading recommendations

If the pair keeps growing the level of 121.60 will be the first target. Shall the USD/JPY decrease it will go to 119.20.