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USDJPY Above Ichimoku on FBI Revelations


Nov.06.2016

USDJPY Above Ichimoku

The US dollar is back in the game with USDJPY above Ichimoku cloud as the FBI revealed they have not changed their original conclusion on Hillary Clinton's emails. With a potential shaky week ahead for Invest Divas, here is an IDDA approach to identify potential forex trading strategies.

 

Technical Analysis - USDJPY Above Ichimoku

The USD/JPY pair tested inside a flat Ichimoku cloud last week after failing to break above the pivot level and 23% Fibonacci retracement level of 105.25. Early on Monday's Sydeny session the pair jumped back above the upper band of the cloud with the future cloud heading upward.

 

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This reveals that at least from a technical point of view, the cloud is acting as a strong support on the daily chart. The long term support is set at 100.

 USDJPY Above Ichimoku - Daily Chart Technical Analysis
USDJPY Above Ichimoku - Daily Chart Technical Analysis

A break above 23% Fibonacci could finally confirm the reversal we've been waiting for, with bullish target set at 108.70.

Fundamentals - USDJPY Above Ichimoku

What went down: The main catalyst for US dollar this week is the US elections. The markets have been fearful of a Trump victory. So last week, when the FBI said they have re-opened investigations on Hillary Clinton emails, the US dollar took a big hit.

On Sunday night the FBI cleared Hillary of any wrongdoings with regards to her emails. This explains the shift of market sentiment in the market.

What's up Next: The elections on Tuesday should still create a ton of volatility in the markets as traders follow the results of the elections state-by-state.

 

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On the economic calendar today during the London session we have German Factory Orders at 7 AM GMT followed by Swiss Consumer Price Index at 8:15 AM.  Eurozone Retail PMI (OCT) is scheduled for 9:10 AM.

Later during the New York session the US Labor Market Conditions Index Change (OCT) will be out at 3 PM GMT to shed more light on  labor market activity and available spare capacity. But it tends to have a muted impact because most of the indicators used in the calculation are released previously.

 

 

Trading Strategy - USDJPY Above Ichimoku

While a Hillary victory has a higher chance now, we still need to be ultra careful with our trades. If you insist on trading during the elections, my recommendation is to set up your limit orders prior to the event.

Bullish Scenario

Depending on your  risk tolerance, you could consider a bullish position targeting 105.25 or 108.70 in extension.

Support is set at 100.

 

Bearish Scenario

Only a break below the Ichimoku cloud would change our outlook to bearish with 100 set as first alternative target.

 

Here are Invest Diva's calculations for important USD/JPY approximate levels to keep an eye on:

Support Levels Turning Point Resistance Levels
97 103.50 108.70
100 105.25 112.50

 

 xoxo

Kiana 喜愛成
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Article is commentary only. Trade at your own risk and analysis. Please read full disclaimer at https://investdiva.com/terms-of-use

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