Daily Forex Outlook USD/JPY

There is a window of opportunity in the USD/JPY. We are looking for +130 pips on this one, so it should be good.

Bookmark It

Technorati Tags: Forex, forex trading, fx, How to make money, How to make money through forex, Trading Forex

As for a short term top should be in place at 99.67 on bearish divergence conditions in 4 hours MACD and RSI.
As of now intraday outlook remains neutral for the moment,USD/JPY is still bounded in tight range below 99.67 high and . Break of 99.67 is needed to confirm resumption of recent rally to 61.8% retracement of 110.65 to 87.12 at 101.66. Otherwise, another fall cannot be ruled out. Below 97.60 will flip intraday bias back to the downside for 38.2% retracement of 87.12 to 99.67 at 94.87 to continue the correction.

In the bigger picture, with USD/JPY still trading below 55 weeks EMA (now at 100.49) as well as medium term falling trend line resistance at 103.15, there is no indication of completion of down trend from 124.13. Having said that, we’d treat the rise from 87.12 as correction in the larger down trend only and expect strong resistance between 100 and 104 resistance zone. Below 92.50 support will suggest that such rebound has completed and will turn outlook bearish for a retest of 87.12/13 support again. However, note that decisive break of mentioned 100/104 resistance will be taken as an early alert that whole down trend from 124.13 has completed and will turn focus to 110.65 resistance for confirmation.

Bookmark It

Technorati Tags: currency trading, forex account, forex dealing, forex exchange, Forex Forecast, forex investing, forex investments, forex options, forex trades, forex trading, forex trading online

Forex Forecast

The Japanese yen remains overvalued against the greenback even after posting an 8.32% loss during the month, and the USD/JPY is likely to push higher over the near-term as the economic downturn in the world’s second largest economy intensifies. The dire outlook for future growth has certainly battered the profound correlation between the yen and the stock markets, and as the low-yielding currency’s safe-haven status comes under question, the dollar-yen is expected to strengthen further over the following month to retrace the sell-off from 2008.

One of the oldest and most basic fundamental approaches to determining the “fair” exchange rate of one currency to another relies on the concept of Purchasing Power Parity. This approach says that an identical product should cost the same from one country to another, with the only difference in the price tag accounted for by the exchange rate. For example, if a pencil costs €1 in Europe and $1.20 in the US, the “fair” EUR/USD exchange rate should be 1.20. For our purposes, we will use the PPP values provided annually by the Organization for Economic Cooperation and Development (OECD). We compare these values to current market rates to determine how much each currency is under- or over-valued against the US Dollar. Currencies overvalued against the Dollar are denoted in RED, while those that are undervalued are denoted in GREEN.

Bookmark It

Technorati Tags: currency trading, forex account, forex dealing, forex exchange, Forex Forecast, forex investing, forex investments, forex options, forex trades, forex trading, forex trading online

USD/JPY Forex Forecast

US Dollar / Japanese Yen Exchange Rate Forecast

Written by Joel Kruger, Technical Currency Analyst; John Rivera, Currency Analyst; David Song, Currency Analyst

Despite the latest sharp monthly reversal off of the 87.15 matched trend lows from December and January, the market remains confined to a prominent downtrend with the current rebound merely classed as corrective. A daily double bottom has been triggered, and ultimately we project additional gains back towards the 104.00 area (measured move objective/20-Month SMA), from where a fresh lower top is sought ahead of the next downside extension back below 87.15 to expose the 79.70 historic lows from April 1995.

The US Dollar/Japanese Yen pair continues to be unaffected by interest rate expectations between the Federal Reserve and the Bank of Japan. Traditionally risk sentiment has driven price action for the pair with risk aversion flows favoring the Yen. However, that relationship disappeared in February as the USD/JPY rallied despite a large sell off in global equity markets.  A year-over-year fourth quarter contraction of 12.7% in GDP for the Japanese economy has put its safe-haven status in doubt.

USD/JPY Forex Forecast

The token 2 bps increase in Japanese interest rates expectations over the next twelve months based on Credit Suisse overnight index swaps, reminds us that the BoJ has traditionally kept rates near zero. Therefore, with the Fed funds rate expected to increase by 41 bps, we could see the Yen resume its position as a funding currency which could add to its weakness going forward.

Bookmark It

Technorati Tags: currency trading, forex account, forex dealing, forex exchange, Forex Forecast, forex investing, forex investments, forex options, forex trades, forex trading, forex trading online