“Risk on” theme points the Japanese Yen lower (USDJPY forecast)

Intermediate
  • The Japanese Yen remain under negative pressures with global financial markets continuing their “risk on” theme into the start of 2020.
  • This has seen USDJPY strength over the past week since the de-escalation of tension in the Middle East and leaves the USDJPY forecast for further gains (see the technicals below).
  • The “risk on” theme has been reflected by global stocks staying strong over the past 24 hours through the signing of US-China trade deal, although no new details of significance have really emerged.
  • The Dow Jones Industrial Average (DJIA) has overcomes the 29000 level whilst the future on the broad benchmark index, the S&P 500 future, has poked at 3300.
  • The Q1 earnings season is at an early stage but has been broadly positive so far.
  • US Retails Sales are in the data spotlight today.

USDJPY day trade outlook: Bull theme intact

A dip and a rebound Wednesday from 1 pip below 109.77 support (from 109.76), to reinforce Tuesday’s surge through 110.00 psychological/ option barrier AND Monday’s advance above the critical 109.73 cycle peak (for an intermediate-term shift to a bull trend), keeping risks higher for Thursday.

  • We see an upside bias for 110.21 and 110.33; break here aims for 110.67.
  • But below 109.77/76 aims for 109.39 and maybe 108.98.

USDJPY intermediate-term outlook

A January push above key 109.73 signalled an intermediate-term bull trend.

Upside threat: We see s an intermediate-term bull trend for 110.67 and 112.40.

What changes this? Below 107.63 sets an intermediate-term bear trend.

4 Hour USDJPY Chart

USDJPY chart

Steve Miley

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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