USDJPY Pulls Back to Ichimoku Cloud on North Korea Tensions

USDJPY North Korea Tensions: Tensions between North Korea and the United States reached a new height on Monday, causing a rally in safe-haven assets such as the Japanese Yen. The USD/JPY pair tested the upper band of the daily Ichimoku cloud on Monday. I have already shared my Ichimoku-based trading strategy with our premium investing group members. Here is a thorough overview of the pair’s movements. 

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Technical Points

Daily Time Frame: For USDJPY North Korea tensions caused the pair to pull back towards the upper band of the daily Ichimoku cloud on Monday. The pair tested the pivot level of 111.68 on Tuesday’s Asian market open. The Ichimoku theory suggests this pullback could be temporary, especially since the Kijun line has crossed above the Tenkan line. The future cloud appears to be turning green. While we still have the Chiko line confirmation to wait for, so far we appear to have sufficient indications to argue a change of sentiment for traders with medium to high risk tolerance. 

USDJPY North Korea Tensions Drops the Pair to Ichimoku CloudAdditionally, the USD/JPY pair appears to have formed lower highs at key resistance levels below 114.29. The medium-term resistance level is set at 112.84. While normally we would expect the pair to see further gains after a pullback towards the Ichimoku cloud, due to the geopolitical tensions, we may need to be more cautious with our profit-taking limit orders.  join our investing group to learn more.

Fundamental Points on USDJPY North Korea Tensions

Tensions between North Korea and the United States reached a new height on Monday, causing a rally in safe-haven assets such as the Japanese Yen.

North Korea’s foreign minister said on Monday President Donald Trump had declared war on North Korea and that Pyongyang reserved the right to take countermeasures, including shooting down U.S. bombers even if they are not in its airspace.

Ri Yong Ho said a Twitter message by Trump on Saturday, in which the president warned that the minister and North Korean leader Kim Jong Un “won’t be around much longer” if they acted on their threats, amounted to a declaration of war.

The USD/JPY pair is back to the upper band of the daily Ichimoku cloud. The JPY rally continued despite the fact that Japanese Prime Minister, Shinzo Abe, called for a snap election on Monday.

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Disclaimer (1): As 4th point of the IDDA, you must calculate your risk tolerance before deciding on which trading strategy is suitable for your portfolio. We normally do not recommend trading without three or more confirmation of a specific direction from technical, fundamental and market sentiment points of view.

Disclaimer(2): Forex is one of the HIGHEST risk investing instruments there is. If you don’t have sufficient risk tolerance to trade forex, you can try investing other online securities.

For further insights on our strategy and where to set your sell limit order and profit taking levels based on your RISK TOLERANCE, join our investing group.

Combining all points of the IDDA, here are Invest Diva’s calculations for important approximate levels to keep an eye on:

Support Levels Turning Point Resistance Levels
108.36 110.75  112.84
109.41 111.68 114.29

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