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Mr. Japanese Yen Caught by Surprise


May.21.2014

日本語版はこちら

Well, well, well. Guess what the Bank of Japan (BoJ) did to catch Mr. Japanese yen by surprise. Mr. Kuroda, the governor of BoJ said today during Asian session that they won’t supply Japan’s money and won’t print more of Japanese yen; a central bank’s activity known as Quantitative Easing (QE). No QE means higher price for Mr. Japanese yen, and on the forex dance floor that translates into a dance move to the south against Ms. USA (because Ms. USA is the lead in this pair.)

On the other hand and just to keep things a bit under control, BoJ policymakers decided to maintain their upbeat assessment for the economy as it continues to recover at a modest pace. They remarked that export activity will be sustained and that core CPI could hold steady at 1.25% for the next few months. They even upgraded their estimates for capital expenditures, as they predict that business investment will continue to strengthen.

On this news, the pair broke below a support level at 101.21 and is now teasing the lower level of a falling wedge, dancing below the Ichimoku cloud with the RSI approaching the oversold zone. A break below 100.3 could change our original bullish outlook to bearish while a confirmation of the falling wedge could get us back on track with our bullish position with 104 and 105 as targets. Intraday, look for short positions below 101.25 with 100.75 and 100.3 in extension.  

USDJPY technical candlestick chart analysis Ichimoku RSI falling wedgebearish outlook

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Intraday Forex Technical Levels

EUR/USD Intraday: under pressure.

Invest Diva likes: Short positions below 1.373 with targets @ 1.3665 & 1.3645 in extension.

If pair goes nuts: Above 1.373 look for further upside with 1.375 & 1.3775 as targets.

What’s up on the dance floor: The RSI is bearish and calls for further downside. The pair is drawing a consolidation in a slightly declining channel.

Supports and resistances:
1.3775
1.375
1.373
1.3678 Last
1.3665
1.3645
1.362

GBP/USD Intraday: supported by a rising trend line.

Invest Diva likes: Long positions above 1.683 with targets @ 1.6935 & 1.697 in extension.

If pair goes nuts: Below 1.683 look for further downside with 1.68 & 1.678 as targets.

What’s up on the dance floor: The immediate trend remains up and the momentum is strong.

スライド1

Supports and resistances:
1.7
1.697
1.6935
1.6901 Last
1.683
1.68
1.678

USD/CHF Intraday: intraday support around 0.8895.

Invest Diva likes: Long positions above 0.8895 with targets @ 0.894 & 0.896 in extension.

If pair goes nuts: Below 0.8895 look for further downside with 0.8875 & 0.886 as targets.

What’s up on the dance floor: A support base at 0.8895 has formed and has allowed for a temporary stabilisation.

Supports and resistances:
0.8985
0.896
0.894
0.8933 Last
0.8895
0.8875
0.886

NZD/USD Intraday: the downside prevails.

Invest Diva likes: Short positions below 0.861 with targets @ 0.8545 & 0.851 in extension.

If pair goes nuts: Above 0.861 look for further upside with 0.8635 & 0.8655 as targets.

What’s up on the dance floor: As long as 0.861 is resistance, likely decline to 0.8545. The pair is trading in a bearish channel.

Supports and resistances:
0.8655
0.8635
0.861
0.8568 Last
0.8545
0.851
0.8485

AUD/USD Intraday: under pressure.

Invest Diva likes: Short positions below 0.9275 with targets @ 0.92 & 0.9175 in extension.

If pair goes nuts: Above 0.9275 look for further upside with 0.9315 & 0.9345 as targets.

What’s up on the dance floor: Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.

スライド3

Supports and resistances:
0.9345
0.9315
0.9275
0.9226 Last
0.92
0.9175
0.915

USD/CAD Intraday: supported by a rising trend line.

Invest Diva likes: Long positions above 1.088 with targets @ 1.0925 & 1.096 in extension.

If pair goes nuts: Below 1.088 look for further downside with 1.0845 & 1.081 as targets.

What’s up on the dance floor: The break above 1.088 is a positive signal that has opened a path to 1.0925.

Supports and resistances:
1.099
1.096
1.0925
1.0912 Last
1.088
1.0845
1.081

Daily US indexes

S&P500

Short positions below 1888 with targets @ 1855 & 1845 in extension.

Alternative scenario: Above 1888 look for further upside with 1899 & 1906 as targets.

Dow Jones

Short positions below 16500 with targets @ 16240 & 16195 in extension.

Alternative scenario: Above 16500 look for further upside with 16620 & 16695 as targets.

Nasdaq 100

Short positions below 3625 with targets @ 3540 & 3507 in extension.

Alternative scenario: Above 3625 look for further upside with 3657 & 3705 as targets.

Russell 2000

Short positions below 1115 with targets @ 1088 & 1078 in extension.

Alternative scenario: Above 1115 look for further upside with 1126 & 1136 as targets.

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