LiteForex - Analytics

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    Analytical review for USD/JPY for 08.06.2016

    Technical performance:

    Prev. closure: 107.36;
    Daily range: 106.72-107.38;
    Opening: 107.36;
    52-week range: 105.52-125.86;
    Annual profit: -10.79%;
    Previous day's change (%): -0.24;

    Analytical review:

    • The yen has grown by over 350 points against the US dollar since the beginning of June. At yesterday's trading session the currency pair held on to a local resistance level of 107.90 and the yen therefore continued to strengthen;
    • Important statistics on Japan's economy have been released today. The country's GDP showed a 0.5% growth in the first quarter living up to market expectations. In the previous quarter, the indicator amounted to 0.4%;
    • The demand for the safe harbour currency is supported against a background of US labour market weakness. The data published last week turned out to be the worst since September 2010;
    • The Commitments of Traders Report shows that important market operators have increased the number of their long positions by 6899 contracts to 95217 contracts. The number of short positions amounts to 109855 contracts;
    • A news factor is worth attention this week: US initial job claims (Thursday) and Japan's service sector activity index (Friday). These events may affect market volatility.

    Summary:

    • Positive macroeconomic data from Japan, US labour market weakness and increased volatility on financial markets pressure on the evolution of this currency pair. According to the Commitments of Traders Report, important operators have increased their long positions;
    • So, we expect that the yen will consolidate against the USD in the nearest future. We advise you to search for market entry points to open short positions.

    Trading tips for USD/JPY

    Key levels:
    Support levels: 106.45, 105.60
    Resistance levels: 107.90, 108.55

    Medium-term trading, H1
    The currency is currently trading near a support zone of 106.45-106.95. Once this zone is broken and tested and relevant confirming signals appear (Price Action patterns, for example), we recommend searching for market entry points to open short positions. Risk per trade: no more than 2% of equity. Stop order shall be placed a bit above the signal line. We recommend that prospective profits should be fixed partly at the levels of 105.85, 105.35 and 104.80, with Trailing Stop applied.

    Medium-term trading, H1
    Medium-term trading, H1

    Short-term trading, M15
    The currency is trading at 106.75-107.25. We advise you to search for market entry points once this zone is broken and tested. Positions shall be opened in the direction of the signal line and the nearest support/resistance level. Risk per trade: no more than 3% of equity. Stop order shall be placed a bit above/below the signal line. Prospective profits shall be fixed partly, at 50%, 30%, and 20% of a prospective fluctuation, with Trailing Stop applied..

    Short-term trading, M15
    Short-term trading, M15


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