EUR/USD: "bears" gained support on weak statistics from GermanyIn the morning trading, the euro is trying to recover from the active decline of the previous day, approaching the level of 1.0965, waiting for new stimuli for further growth.The main factor of the "bearish" trend was the weak economic statistics from Germany. In June, the industrial production index decreased by 1.5%, which is more than the previous value of -0.1% and tends to March results of -3.4%. In parallel, the consumer price index was unchanged at 0.3% for the month and on an annualized basis fell from 6.4% to 6.2%. The harmonized index, in turn, rose from 0.4% to 0.5% on a monthly basis, and on an annualized basis experienced a correction, falling from 6.8% to 6.5%. This data is pushing the possibility of an interest rate increment by the European Central Bank (ECB) at its upcoming September meeting.Support levels: 1.0900, 1.0760.Resistance levels: 1.1030, 1.1200.GBP/USD: ahead of important data from the US and UKIn the morning trading on August 9, the pound is showing mixed movement at 1.2750.After the previous day's sharp decline, caused by the BRC retail sales statistics, which showed a gain of only 1.8% instead of the expected 3.0% and June data of 4.2%, the currency is looking to regain lost ground. Preliminary forecasts point to further deterioration, as consumption levels are falling as wage growth fails to keep pace with rapidly rising inflation. But for now traders refrain from active actions, waiting for key economic data from the US and UK, the publications of which are announced at the end of the week.On Thursday, the market will learn the data on US consumer inflation for July, which will allow to clarify the forecasts on the monetary policy of monetary authorities. Note that analysts are now predicting inflation to rise between 3.0% and 3.3% per annum, exceeding the Fed's target of 2.0%.Resistance levels: 1.2800, 1.2850, 1.2900, 1.2963.Support levels: 1.2747, 1.2690, 1.2600, 1.2500.USD/JPY: the pair's dynamics changed, ending a two-day riseThe US dollar is developing a correction at 143.12 after posting two-day gains earlier in the week, with USD/JPY hitting new highs since August 3. Trading activity declined as traders await US consumer and manufacturing inflation data.Meanwhile, fresh economic statistics from Japan, published the day before, did not add confidence to the yen. Thus, Japanese household spending in June fell by 4.2% year-on-year, continuing the trend of the previous month with a decline of 4.0%. It also became known that the growth of bank loans slowed to 2.9% per annum, which was below market expectations of 3.1%. At the same time, Japan's current account balance in June showed a fifth month of growth, reaching a surplus of 1.509 trillion yen, which exceeded forecasts of 1.395 trillion yen. Note also the 1.0 trillion yen improvement from a year earlier. Official representatives of the Ministry of Finance of Japan emphasized the positive dynamics of the trade balance, which reached 328.0 trillion yen. The published statistics confirmed the impact of high energy prices and weak yen on one of the world's largest economies, which relies heavily on imports of energy and raw materials.Resistance levels: 143.48, 144.00, 145.00, 146.00.Support levels: 142.54, 142.00, 141.50, 140.50.Crude Oil market analysisDuring Asian trading, Brent crude oil is holding steady around 85.70, correcting after a sharp drop a day earlier.The main reasons for the recent drop in prices were investors' concerns over weak Chinese foreign trade data and information from the American Petroleum Institute (API) regarding changes in commercial inventories. Specifically, exports fell by 14.5% against the forecasted -12.5%, while imports fell by -12.4%, although analysts expected a 5.0% drop. Such a sharp decline in statistical indicators raises concerns among market participants about the slowdown in China's economic recovery after the COVID-19 pandemic. Taking into account that China is a key consumer of oil and oil products, such changes may negatively affect the overall demand.Resistance levels: 86.00, 87.33, 89.20, 91.00.Support levels: 85.15, 83.89, 82.27, ...
On Wednesday, USD/JPY buyers turned active and the pair broke through the resistance at 148.00.Despite the low market volatility, caused by expectations of the results of the Fed meeting, the "bulls" managed to update the local maximum and are not going to give up their positions.Investors believe that at today's meeting the Fed will keep the rate at the same level of 5.5%, but will make it clear that with a new round of inflation caused by rising oil prices, the regulator will continue to tighten monetary policy and in November may raise the rate by 25 basis points to 5.75%.Japan's macroeconomic statistics, published on Tuesday, failed to have a significant impact on the yen dynamics. In August, exports decreased by 0.8% and imports by 17.8%. Japan's trade deficit for the month rose from ¥66.3 billion to ¥930.5 billion.On Friday, the Bank of Japan will hold a meeting. It is possible that the regulator will change the current course of monetary policy, especially as USD/JPY is confidently approaching 150.00, and inflation has not yet approached the 2% target.USD/JPY Technical AnalysisOn the chart of the day, the Bollinger Band Indicator remains in an upward direction. At the same time, the MACD Indicator is declining in a positive range and has formed a weak sell signal, which may be canceled soon. The Stochastic oscillator is flat in the overbought range.In case of price consolidation above the key resistance at 148.00, we open long positions with the expectation of reaching the target at 149.00. Stop-loss is set at 147.36.It makes sense to consider selling only if the pair falls below 147.36. In this case, the nearest target of the "bears" is at 146.00. Stop-loss of the deal is placed at ...
Trading idea for USD/JPY from September 6, 2023Today, in the Asian session, USD/JPY updated its 10-month high around 147.80, and then moved into a corrective decline and at the moment went down to 147.50.The pair's active growth is primarily caused by the strengthening of the dollar on the deterioration of market sentiment and an increase in the yield of US debt bonds. The rate of ten-year securities on the eve reached 4.27%, which helped the dollar index to rise to the maximum of March 2023 at 104.85.The deterioration of market sentiment was provoked by China's statistics. Thus, the index of business activity in the services sector of China in August fell from 54.1 to 51.8. Investors see that the "fast" start of the Chinese economy, expected since the beginning of the year, is clearly delayed, which complicates the recovery of the global economy. Amid the uncertainty, the demand for safe assets is growing, where the dollar and US government bonds stand out especially.The ISM US Services Business Activity Index for August will be released today. The indicator is expected to decrease from 52.7 to 52.6 pp. We hope that weak statistics can send the dollar into decline. Otherwise, only the currency intervention of the Bank of Japan can deploy the pair. The risks of intervention by the Japanese regulator greatly limit the potential of strengthening the pair. According to technical analysis, several divergences have already been formed on the Daily USD/JPY chart by indicators, but divergence in trading is a rather conditional concept and serves more to exit a deal than a signal to enter the market.Based on the news "bearish" momentum, we place a sell order for USD/JPY.Sell-limit 148.50take-profit 144.00stop-loss ...
USD/JPY analysis for August 31, 2023USD/JPY shows flat dynamics in the range of 145.50 – 146.00. Apparently, buyers took a break, which the bears did not fail to take advantage of, although the bulk of investors prefer to stay away until the release of Non-farm Payrolls on Friday.The US labor market report from ADP was released yesterday. In August, employment increased by only 177.0 thousand with a forecast of 195.0 thousand. In July, the figure was 371 thousand. In addition, the GDP estimate of the second quarter was revised downwards from 2.4% to 2.1%.Some support for the yen was provided by statistics published today in Japan. In July, retail sales volumes increased by 2.1%, and in annual terms from 5.6% to 6.8%, with expectations of 5.4%. At the same time, during the reporting period, the volume of industrial production decreased by 2.0% (mom) and 2.5% (YoY).USD/JPY: Bollinger bands and MACD Technical indicators, graphical and candlestick patterns do not give unambiguous signals. The Bollinger bands remain in the horizontal plane, the MACD indicator is in a positive range, but it is declining to zero and has formed a weak sell signal. The Stochastic oscillator is declining.After a confident breakdown with the price fixing below the support of 146.00, we open short positions with a take profit of 145.00. We set the stop loss at 146.62.In case of a break above 146.62, we return to purchases with a target mark of 148.00. Stop loss placement – ...
Since the beginning of Monday's trading session, USD/JPY has not decided on the direction of movement and is currently trading just below the level of 146.50. At the end of last week, the pair actively strengthened, reacting to Jerome Powell's performance in Jackson Hole.The head of the Fed, as expected, noted the high probability of a further rate hike, which distanced the prospects of a "dovish" reversal. The chances that the Fed will raise the rate to 5.75% by the end of the year have increased to 55%.In addition, national statistics put pressure on the yen. The consumer price index of the Tokyo region for August fell from 3.2% to 2.9% with a forecast of 3.0%. The indicator, which does not take into account food, sank from 3.0% to 2.8% Inflation in Japan compared to other countries remains low, which allows the Bank of Japan to adhere to the course of a soft monetary policy. But the regulator's concerns are caused by the excessively low exchange rate of the yen, so the Central Bank may at any time conduct a currency intervention.Technical analysis for USD/JPYThe indicator of the Bollinger Band on the chart of days is confidently directed to growth. The MACD indicator remains in a positive range and retains a buy signal. The Stochastic oscillator is testing the 80% level for a breakdown from the bottom up and may enter the overbought area in the near future.We are considering the formation of long positions after fixing the pair to the tower of 146.62. The target mark of buyers is 148.00. We set the stop loss at 145.90.When fixing below the strong support of 146.00, we move to short positions in the direction of 145.00. We take out the stop loss at ...
Trading idea for USD/JPY on August 22On Tuesday, USD/JPY is declining and is currently trading at 145.80. The day before, the pair strengthened with the maximum mark of the day of 146.39. Buyers failed to gain a foothold in the extreme area, sellers who seized the initiative took advantage of the dollar correction caused by expectations of Jerome Powell's speech at the symposium in Jackson Hole.The risks of currency intervention by the Bank of Japan also put pressure on the pair. As a rule, the regulator does not allow the asset to go above the key level of 145.00 and most often intervenes in forex currency trading. Traders understand that this time BYA is able to present a "surprise" to USD/JPY buyers. However, JP Morgan is confident that the regulator will not take any action until the pair tests the 150.00 mark, since the economic situation does not require measures to support the exchange rate of the national currency.Japan's statistics published on Friday did not have a significant impact on the yen exchange rate. The consumer price index in July remained at 3.3% with a forecast decline to 2.5%. The base index, which does not take into account the cost of food and energy, strengthened from 4.2% to 4.3%Investors are waiting for a report on Japan's inflation, which may significantly affect the monetary policy of the Central Bank.In addition, the focus this week is the economic symposium in Jackson Hole, where Jerome Powell will speak on Friday. At the moment, there is no consensus in the FOMC on the direction of monetary policy. A number of Committee members believe that the rate increase should be continued, while others insist on completing the cycle of monetary restriction. Market participants want to know the opinion of the head of the Federal Reserve, and if he hints at the rejection of the "hawkish" rate, then USD/JPY will move to a sharp declineI offer to place a sell order for USD/JPYSell-stop 145.30take-profit 142.00stop-loss ...
On Monday, USD/JPY is trading in a narrow price range near the level of 145.30. Last week, a meeting of the Bank of Japan took place, which practically did not affect the dynamics of the national currency, although the pair remains near the key mark of 145.00, after the breakdown of which the regulator, as a rule, begins currency interventions.At the end of the week, a block of economic releases of Japan was released. The consumer price index in July remained at the level of 3.3% with a forecast of a slowdown of 2.5%. The base index showed an increase from 4.2% to 4.3%. Japan's inflation report will be published this week. A slowdown from 3.2% to 3.0% is expected. Core inflation may decrease from 3.0% to 2.9%. In such a scenario, it is unlikely that the Bank of Japan will move to tighten financial conditionsAlso this week, an economic symposium will be held in Jackson Hole, where Jerome Powell will speak on Friday. The dollar index is trading at 103.28.Technical analysis for USD/JPYThe Bollinger Bands indicator on the daily chart are confidently aimed upwards, while the MACD histogram has begun to decline noticeably, remaining above the zero line. The indicator generated a weak sell signal. The Stochastic oscillator is steadily declining.When anchoring below the key level of 145.00, we form short positions with the nearest target of 143.48. We set the stop loss at 145.75.A break above the resistance of 146.00 will mean the continuation of the uptrend. In this case, we continue to buy with a target of 148.00. Placement of the protective stop at ...
Trading idea for USD/JPY on August 1, 2023USD/JPY recovered on Tuesday, building on last week's bullish momentum. Pushing off from the local low of 139.50, the pair added around 300 pips to reach 142.60.The yen remains under pressure despite strong macroeconomic statistics from Japan, where, in particular, the June industrial production figure rose by 2%. Retail sales for June showed an increase from 5.8% to 5.9%. However, the good data of economic indicators are leveled by the rhetoric of the head of the Bank of Japan Kizo Ueda, who denies the possibility of the regulator's transition to tightening financial conditions, noting, however, the need to adjust the analysis of the yield curve. The same opinion is held by the Minister of Economy of Japan, who said today that "the time to abandon the soft monetary policy has not yet come".The Fed and BoJ rate differentials are the main driving force behind the USD/JPY strength.The US labor market report will be released this week. It is expected to show job cuts with average wages and unemployment rate unchanged. If we remember Jerome Powell's words that the Fed will make decisions based on input data, the significance of Friday's NFP is hard to overestimate. We think that this week the main method of forex trading on USD/JPY will be "buy on rumors, sell on facts.We expect the upward dynamics of USD/JPY to continue and place a buy order.Buy-stop 143.00 take-profit 145.50 stop-loss ...
The dollar fell against the Canadian dollar and hovered near multi-month lows against European currencies on Tuesday as Treasury bond yields were little moved amid expectations the US Federal Reserve will not raise interest rates in the near future.Dallas Fed President Robert Kaplan reiterated on Monday that he does not expect interest rates to rise until next year, lowering expectations that inflationary pressures could force the Fed to change policy sooner than stated.Read more: Causes of inflation and scientific approaches to their studyThe yield on 10-year US Treasury bonds stood at 1.6454%, continuing a decline from last week's five-week high.The dollar index to a basket of six major currencies was down 0.19% to 89.991 by 09:34. The euro rose 0.25% to $1.2181, close to its lowest level since February 26. At the same time, the pound rose 0.31% to $1.4178. The British currency was supported by the lifting of coronavirus restrictions in the UK.The Canadian dollar rose 0.31% against the US dollar to $1.2029, almost hitting a six-year high, thanks to higher oil prices. "The Aussie rose 0.46% to $0.7799. The New Zealand dollar rose 0.58% to $0.7242.The mainland yuan rose 0.2% to 6.4257. The Japanese yen rose 0.1 per cent paired with the dollar, to 109.08 yen.In the cryptocurrency market, bitcoin rose 3.81% to $45.255 but remained near a three-month low following tweet from Tesla CEO Elon Musk. Etherium rose 7.58% to $3,529.95, recovering from a two-week low hit on Monday.Read more: The history of Federal Reserve (Fed) and its ...
The foreign exchange market is better known as Forex or FX. Trading in this market has become very popular in recent years. However, this is not the case - Forex trading raises a number of questions. For example: what is the foreign exchange market? Which currency pairs are best to trade? Is currency trading risky? Some of the answers to these questions will be found in this article.What is the Forex market?The foreign exchange market is also called the Forex market or the English foreign exchange market. It is simply a market where currencies are exchanged. According to the Bank for International Settlements (BIS), the foreign exchange market is the largest market in terms of total volume, with up to USD 5 trillion traded daily. It is not a physical place, but rather an electronic network where institutions or individuals trade with each other.The left-hand currency is called the base currency and the right-hand currency is called the quote currency. The second currency indicates the value relative to 1 unit of the base currency. For instance, the formula EUR/USD = 1.4000 implies that EUR/USD trades at 1.4000, i.e., 1 Euro has a value of $1.40. The first currency is always expressed in the second currency. USD/JPY at 110.50 means that one USD is worth JPY 110.50. EUR/USDWhat are the best currency pairs to trade?The best currency pairs to trade effectively depend on your trading style. If you have a short term strategy, for example, if you like to scalp, then the major currency pairs will be most profitable for you because of the low spreads.On the other hand, for a fundamental trader, smaller currency pairs will be of interest based on long-term analysis. The most profitable currency pairs may be those involving the Australian dollar, Japanese yen or Canadian dollar.The best forex currency pairs:EUR/USD: this pair has the lowest spread and is not very volatile.GBP/USD: this pair is interesting in terms of spreads and possible gaps, but it is quite volatile.USD/JPY: this pair has low spreads and offers some interesting possibilities. GBP/USDHow to get started trading currencies online?To start trading currencies online, follow these steps:- Choose a regulated and reputable broker- Choose a broker by the quality of execution of trading instructions- Decide on the trading style that suits you best (scalping, intraday trading, swing trading - you keep your position open for several days)- Determine the appropriate leverage effect in the stock market according to your strategy and experience.- Do not invest more than you can afford to lose.- Choose an intuitive, simple and secure trading platform such as MetaTrader 4.- Try all the above steps on a demo account, before trading live.Read more: Features of intraday trading on the Forex marketGoldIs online currency trading dangerous?Like any financial investment, currency trading online is subject to risks. However, there are different methods to control these risks:- Determine the price of the currency pair at which you want to close a position if developments are unfavourable (for example, if you buy and the price falls, or if you sell and the price rises),- Determine the size of the trade so that your potential loss should not exceed 2-3% of your capital per trade,- Estimate your risk/return ratio (loss/profit) before you open the trade. By default you should have a greater potential for profit than loss, e.g. risk 50 pips, but try to make a profit of e.g. 100 pips.For proper money management and risk reduction it is advisable to start trading on a demo account and try things out on the dirt first. Such an account will allow you to trade in real market conditions, but with fictitious capital, so that you have a complete understanding of the foreign exchange market without any risk.Read more: Forex broker: how to choose a good ...
The USD/JPY currency quote (US dollar vs Japanese yen) is in second place in terms of turnover after the USD/EUR pair, which is the favorite in terms of liquidity.One of the reasons is the very low cost of the lot, which is approximately equal to $1,200.USD JPY forecast (online) for todayForecasts for USD/JPY have 4 timeframes and different signal strength. It is better to pay attention only to the strongest forecast - Actively buy or Actively sell. The repetition of this signal on all timeframes can also be considered a strong value.Forecasts for USD JPY are based on 20 indicators. Considering the pair from the point of view of technical analysis, mathematical indicators based on the contact of moving averages have a good result. These systems function perfectly on the trend markets, which corresponds to the nature of the movements of the Japanese national currency. Fast and slow stochastics often give false signals, but their derivative indicators - oscillators - show good and clean entry points.General characteristics of USDJPYFOREX, as a platform that accumulates most currency pairs, is an excellent opportunity to start working with USD/JPY.In the global economy, Japanese assets, including the national currency, play the role of a kind of safe haven. At times when panic and despair come to the stock exchange, this immediately affects the price. The dollar is declining relative to the banknotes of the "land of the rising sun" under the pressure of increasing demand among traders.The volatility of the USD JPY pair is known to every experienced player in the FOREX market. Lightning-fast and unpredictable waves of growth and fall constantly happen to this pair. Such movements allow you to take a good profit for a short period of time. It is extremely problematic to predict prices for USD/JPY in the relatively long term. Nevertheless, it is also not accepted to talk about some kind of increased volatility in relation to USD/JPY.Read more: GBP/USD exchange rate (Online Chart), forecast for todayWhat USD JPY quotes depend on and what influences the exchange rateJapan's industry is focused on the export of goods. That is why the main financial institutions in the country are doing their best to counteract the "strong" yen.A cheap national currency is the key to the profit of exporters, who, in turn, pay taxes to the state budget.If there are situations when the yen is strengthening too much, Japan resorts to currency intervention measures, synthetically inflating the price of USD/JPY. For the same purposes, the Central Bank of Japan keeps interest rates prohibitively low, not exceeding one tenth of a percent (0.1%).Actively trading on this pair, you should not stop only on technical analysis. It is necessary to be aware of the main news concerning finance, politics, along with macroeconomics. There is a pattern of USD/JPY movement with political events in the USA and Japan. The reaction from the US dollar is formed due to factors such as:Increase in the Fed's lending rate.Changing the economic balance of power in the United States.Downgrade of the credit rating of the United States.Read more: What is the US Dollar Index DXY and how to trade it?How best to trade USD/JPYOn time frames of 4 hours or more, the chart of the USD/JPY pair is largely correlated with the Nikkei 225 (Tokyo Stock Exchange index).If you open the Nikkei 225 and yen chart at the same time interval (preferably 4 hours or more, so as not to encounter a lot of noise) and constantly monitor them, then, from time to time, you can observe such situations when the Nikkei 225 begins a noticeable downward or upward movement, which is not yet observed on the yen chart, but then USD/JPY almost always repeats them, too.Such situations are good entry signals and are almost always confirmed.Studying the hourly chart (H1), you can see that the direction of the candle that appears at the opening of the American trading session almost always determines the direction of movement of the currency pair until the opening of the London session, which can be advantageously used as a USD/JPY forecast for intraday transactions.Immediately after the opening of the American session, we enter (if a bearish candle, then into sales, if bullish - into purchases), and immediately before the start of the London session, we close the deal.Features of the currency pairDue to the low price, USD/JPY has only two decimal places. It looks something like this: USD/USD = 119.15 - where the last digit is equal to one point.Currency trading in Japan, when movements in USD/JPY have the maximum volume, is conducted at night for Europe.USD/JPY is an interesting tool of the FOREX currency market, which is suitable for medium-term investors in the framework of swing trading. This is a great option for a more advanced trader who is looking for more complex financial instruments with non-trivial price change ...
Scalping or scalping is a strategy that makes many demands on traders. Perhaps the most serious of them is to accept that everything you think you know about Forex trading will be wrong in this context.Forget about it. Scalping is an opportunity to quickly make money on price changes when transactions last 5-10 minutes.Avoid "political" currenciesDo you want to make money by trading a large amount of money in anticipation of some serious movement? No, scalping is earning money on small price movements. And, what is even more likely in relation to the Forex market, it is worth forgetting about searching for highly volatile pairs in the hope of getting a big profit. George Soros managed to do this in 1992, and you can try to repeat it on a smaller scale, but this will be an example of ordinary trading, not scalping.Successful scalping is based on the use of relatively insignificant price movements. And it depends on a good and thorough analysis of the relevant currencies.First, which currency pairs to choose for scalpingHighly "political" or inflation-prone currencies are not suitable in this context, because they are likely to be very volatile, and high volatility should be avoided.Read more: Volatility: types, how to track and how to useLanguage barriersIt is much better to find a currency pair that is relatively stable, so that its movement can be analyzed and predicted.The obvious candidate would be the EUR/USD exchange rate. This is the most popular currency pair in the world, for which the most transactions are made, and it has many functions that we need.But it has drawbacks.First, it may seem at first glance that these two currencies are, by and large, equivalent. Both are equally popular, issued by developed democratic states, controlled by independent central banks, but in fact they are not comparable.Read more: Causes of inflation and scientific approaches to their studyThe dollar is the currency of a successful political union, it is supported by the federal government and the national treasury, and the central bank, the Federal Reserve System, enjoys broad public support. The euro, the currency of 19 national states, is not supported by the federal government, is prone to crises, as can be seen from what happened to Greece after the 2008 financial crisis, and its management is often criticized.The second drawback is the complexity of the analysis of the European Central Bank, unlike the Fed. There are many, many variables; the position of individual members of the board of directors, the demands of the" southern", poorer countries, the position of the European Commission, which is responsible for economic affairs, and the wishes of Germany, a powerful economy of the European Union.This is compounded by various language barriers that need to be overcome when studying the statements of those who determine the behavior of the ECB.Finally, the ECB is much more autonomous than the Fed.Perhaps the USD/JPY pair may be a more suitable option? The Japanese currency, like the dollar, is the currency of a single state, and the two economies conduct extensive trade with each other. But the language barrier is even more pronounced, and the Bank of Japan is not independent, which means that it is potentially open to political interference.Read more: The European Central Bank (ECB)Communication across the AtlanticThe best candidate for scalping may be USD/GBP. The Fed and the Bank of England are independent but accountable central banks, there is no language barrier, and the legal systems of the two countries are very close.The recent dynamics of the pound against the dollar was quite high, which gives scalpers the opportunity for significant profits. The reasons for this movement include the signing of a trade agreement with the European Union and hopes for the recovery of the UK economy.To predict strong movements in the short term, traders need a thorough and constant analysis of the factors that affect the movement of currencies: economic expectations, fiscal policy and, of course, interest rates. Scalpers will be helped by the fact that both countries have the same attitude to economic management, giving priority to a strong private sector, competitive tax rates and high growth rates.Plus, the US and the UK have a long history of bilateral inter-Atlantic trade.Transactions with GBP/USD may lack the attractiveness of exotic currency pairs, but scalping is not an adventure in the Forex market, but a way to make a profit.Read more: Rich history of the Bank of ...