Tag: AUD/JPY

FX Commentary – Yen Perched Near 7-month Highs Ahead Of BOJ Policy Meeting

Nicholas

Market Talk
– The US dollar drifted off multi-month lows on Tuesday, while the yen was perched near seven-month highs as investors held their breath for a potential policy shift at the Bank of Japan policy meeting, which is scheduled for 18 Jan 2023.

– The BOJ will hold its monetary policy meeting tomorrow. Market sees three possibilities: no policy change, a tweak similar to a move in December to widen the 10-year yield target band, and the total abandonment of yield curve control, with the latter likely to drive the most extreme market response.

– The euro reached a nine-month high on Monday at $1.0874, but was last loitering around $1.0830. The yen hit a top of 127.22 per dollar during Asia hours on Monday, before easing a little during a holiday-thinned U.S. session to sit around 128.40.

– The Australian dollar hit a five-month high just above $0.70 on Monday and was last firm at $0.6972, despite Beijing releasing a weak fourth quarter economic data. The New Zealand dollar held at $0.6394.

– Spot gold was unchanged at $1,917.24 per ounce, holding steady above the key $1,900 per ounce level during early Asian hours on Tuesday, buoyed by hopes of slower interest rate hikes by the Federal Reserve.


Chart Focus EUR/JPY

Key Points

1. Sell EUR/JPY recommendation.

2. Sell EUR/JPY at 139.55. Stop at 139.90 and profit target at 138.05.

3. Speculation the Bank of Japan (BOJ) will revise its ultra-loose monetary policy is aiding the yen.

4. Price is likely to face stiff resistance at the Fibonacci 38% correction point and the 20EMA with MACD hinting at a bearish price trend.

Fundamental Comments

1. Speculation the Bank of Japan (BOJ) will revise its ultra-loose monetary policy is aiding the yen.

2. A slower pace of interest rate hikes by the European Central Bank on signs of easing inflation is likely to weigh on the Euro.

Technical Comments

1. Price is likely to face stiff resistance at the Fibonacci 38% correction point and the 20EMA.

2. MACD remains bearish and is hinting at a bearish price trend.



Key Levels

Support139.05138.50137.95
Resistance139.60139.95140.40









Technical Overview

USD/JPY – Price reached a high of $129.15 this morning but the rally was capped by 20EMA. Price was unable to move above the 20EMA hinting that the price trend is still bearish. MACD remains below the zero line which is hinting a bearish trend. Stochastic is rising and hinting at a price rally. If the price is capped by the 20EMA at $129.05, we may see a decline to the previous low support at $127.20 in the next 48 hours.

Support128.45128.10127.55
Resistance129.15130.00130.75

EUR/USD – Price declined to $1.0800 yesterday but was supported by 20EMA. Price has bounced up after testing the 20EMA which is hinting at a bullish price trend. MACD remains bullish but looks weak at the moment. Stochastic is declining and hinting at a price decline. As long as the price stays above 20EMA around $1.0800, we are likely to see a rally back to yesterday’s high at $1.0873 again in the 24 hours.

Support1.08001.07601.0725
Resistance1.08451.08751.0930

GBP/USD – Price reached a high at $1.2288 on Monday morning but declined to $1.2170 in early Tuesday morning. Both MACD and 20EMA are neutral at the moment. Stochastic is moving lower and is hinting at a price decline. Price is likely to be supported by the 20EMA. As long as the price stays above this point, we could see a rally back to yesterday’s high at $1.2288. A break below $1.2140 is likely to negate our bullish view.

Support1.21701.21301.2085
Resistance1.22251.22851.2355

XAU/USD – Price reached a low of $1907.97 as at the time of this writing and this could be a corrective decline. 20EMA is likely to halt the decline at $1904.85. MACD remains above the zero line and is hinting at a bullish price trend. However, stochastic is moving lower and is hinting at a price decline. We are likely to see some correction to the 20EMA at $1904.85 before the price resumes the rally to $1928.65 in the 24 hours.

Support1901.251892.101879.85
Resistance1919.501928.651939.30

AUD/JPY – We had a sell call on this pair yesterday at 89.90. However, price only reached a high of 89.86 and our entry price was not filled. We remain bearish on this pair. MACD and 20EMA remain bearish and are hinting at a bearish price trend. Stochastic, is rising and hinting at a price rally. We see price being capped by the Fibonacci 50% correction point and the 20EMA line around 90.10. We see price going lower to 88.60 in the next few days

Support89.5589.0588.55
Resistance90.1090.5091.05

FX Commentary – Expectations of An End to BOJ Ultra Loose Monetary Policy Boosted The Yen.

Nicholas

Market Talk
– The yen surged on Friday, adding to earlier gains on speculation the Bank of Japan (BOJ) will revise its ultra-loose monetary policy, while the dollar edged up against most other major currencies, rising off of a seven-month low.

– The University of Michigan Surveys on Friday showed that U.S. consumers are becoming more confident that price pressures will ease considerably over the next 12 months with one-year inflation expectations falling in January to the lowest level since the spring of 2021.

– The Japanese yen rose to a more than seven-month peak on Monday, as expectations that the BOJ would make further tweaks to, or fully abandon, its yield control policy when it announces its monetary policy decision on Wednesday. The yen jumped to a high of 127.24 per dollar, and last bought 127.58 per dollar.

– The Australian dollar broke past the psychologically important level of 70 cents on Monday, hitting an intraday high of $0.7019, its highest since Aug. 17, buoyed by a retreat in the safe-haven U.S. dollar and expectations of higher commodity prices as a result of China’s rapid reopening.

– Spot gold rose 1.3% to $1,920.70 per ounce on Friday, the highest since end-April 2022. The yellow metal continues its rally to a high of $1928.65 on Monday’s morning, as cooling U.S. inflation raised hopes for a slower pace of interest rate hikes from the Federal Reserve.


Chart Focus AUD/JPY

Key Points

1. Sell AUD/JPY recommendation.

2. Sell AUD/JPY at 89.90. Stop at 90.20 and profit target at 88.65.

3. Speculation the Bank of Japan (BOJ) will revise its ultra-loose monetary policy is aiding the yen.

4. Price is likely to face stiff resistance at the Fibonacci 50% correction point and the 20EMA with MACD hinting at a bearish price trend.

Fundamental Comments

1.  Speculation the Bank of Japan (BOJ) will revise its ultra-loose monetary policy is aiding the yen.

2. A change in the BOJ monetary is likely to hint that the interest rate differential between the two currencies has peaked.

Technical Comments

1. Price is likely to face stiff resistance at the Fibonacci 50% correction point and the 20EMA.

2. MACD remains bearish and is hinting at a bearish price trend.


Key Levels

Support89.0088.5588.00
Resistance89.5590.1090.50









Technical Overview
USD/JPY – Price reached a low of $127.21 this morning, which is just above the Fibonacci 161.8% projection point from the high of $134.34 to $132.86. 20EMA is still pointing lower, hinting at a price decline. MACD is supporting the bearish trend as well. However, stochastic is in the oversold zone and is hinting at a limited downside. If the price is unable to sustain above the $127.21 level, we are likely to see the decline resume to the next low at $126.35

Support127.20126.85126.30
Resistance127.95128.50129.15

EUR/USD – Price moved to a high at $1.0873 this morning, which broke above last week’s high at $1.0867. This high was accompanied by a divergence warning from the MACD indicator. Stochastic is in the overbought zone and is hinting at a limited upside. 20EMA remained bullish and is hinting at a bullish price trend. Price may need to break and sustain above the $1.08670 level to resume its upside momentum for 1.0930.

Support1.08301.07801.0745
Resistance1.08751.09301.0995

GBP/USD – Price broke above last week’s high at $1.2247 and reached a high of $1.2288 today as at the time of this writing. Both MACD and 20EMA are pointing up and hinting at a price rally. However, stochastic is still in the overbought zone and is hinting at a limited upside. We remained bullish in our view. Price is likely to continue to move higher to $1.2300 in the next 48 hours. A move below 1.2140 would negate our bullish view.

Support1.22201.21801.2100                                 
Resistance1.22851.23551.2400

XAU/USD – We saw a price rally to $1928.65 this morning and the price could be in a corrective decline at the moment to $1916.56. 20EMA is pointing higher, hinting at a bullish price trend. MACD remains bullish and hinting at a bullish price trend. However, stochastic is rising into the overbought zone, hinting at a limited upside. Price is likely to have some correction to $1900 in the next 24 hours.

Support1911.801892.101879.85
Resistance1928.651939.301955.60

USD/CAD – We had a buy recommendation at $1.3360 last Friday which was filled. Unfortunately, the price declined to a low of $1.3320 and triggered our stop at $1.3330. We are out of this position with a 30 pips loss. While stochastic is pointing higher hinting at a price rally, 20EMA is hinting at a bearish price trend. MACD is hinting with divergence of a possible price low. We see price going up to 1.3450 in the next 24 hours.

Support1.33501.33101.3275
Resistance1.33951.34451.3485

FX Commentary – Euro Hit A 7-Month High Ahead Of US CPI Report.

Nicholas

Market Talk
– The Japanese yen got a boost on Thursday on expectations that the Bank of Japan will review the side effects of its monetary easing, while the dollar declined to a seven-month low against the euro ahead of U.S. inflation data later in the day.

– The Japanese yen jumped nearly 0.7% to 131.58 per dollar in early Asia trade, following a Yomiuri report that the BOJ will review the side effects of its monetary easing at next week’s policy meetings and may take additional steps to correct distortions in the yield curve.

– The euro hit a seven-month high against the dollar but held within a narrow range as traders avoided making big moves ahead of U.S. inflation data on Thursday, which may offer a clearer picture of where U.S. interest rates are headed. Sterling was little changed at $1.2150.

– The Aussie rose 0.11% to $0.69135, after Australian inflation data released on Wednesday showed that annual inflation re-accelerated to 7.3% in November, underscoring the challenge facing the Reserve Bank of Australia as it tries to cool the economy. The kiwi edged up 0.13% to $0.6375.

– Gold prices were little changed on Thursday morning at $1879.80 per ounce as investors positioned themselves ahead of U.S. inflation data that could influence the Federal Reserve’s policy path.


Chart Focus USD/JPY

Key Points

1. Sell USD/JPY recommendation.

2. Sell USD/JPY at 132.15. Stop at 132.50 and profit target at 130.70.

3. Report that BOJ will look to ease its ultra-loose monetary policy and expectations of a slower pace of rate hikes are weighing on the US dollar.

4. Price is likely to be capped by the 20EMA and MACD is hinting at a short term bearish price trend.

Fundamental Comments

1. News report that the BOJ will look to ease its ultra-loose monetary policy is aiding the Japanese yen.

2. Expectations of a slower pace of US rate hikes are weighing on the US dollar

Technical Comments

1. Price is likely to be capped by the 20EMA, which is hinting at a short term bearish price trend.

2. MACD has turned bearish and is hinting at a short term bearish price trend.



Key Levels

Support131.40130.70130.25
Resistance131.80132.25132.85









Technical Overview

AUD/USD – We had a buy call Tuesday at 0.6875, which was filled. Yesterday, we had recommended moving stop to cost at 0.6875 and profit target at 0.6945. Unfortunately, price decline to a low of 0.6872 and our stop was triggered. We are out of this position at cost. Both MACD and 20EMA remain bullish and are hinting at a bullish price trend. Stochastic has a bullish crossover and is also hinting at a bullish price trend.

Support0.68900.68600.6825
Resistance0.69500.68950.7010

EUR/USD – Price had broken out from the flag chart pattern to reach a high of $1.0775 yesterday. Stochastic is in the overbought zone and is in hinting at a limited upside. However, both MACD and 20EMA remain bullish and are hinting at a bullish price trend. We may see the price rally to $1.0930 in the next few days. A price move below 1.0690 would negate our bullish price trend.

Support1.07451.07101.0680
Resistance1.07901.08151.0850

GBP/USD – Price currently is still consolidating within a potential Flag chart pattern. Price reached a low of $1.2100 and was supported by the 20EMA. Both MACD and 20EMA remain bullish. Stochastic is supporting the bullish trend, if the price is able to break above the flag chart pattern, we may see the price move higher to this week’s high at $1.2225 in the next 48 hours.

Support1.21251.20801.2030
Resistance1.21851.22101.2250

XAU/USD – Price reached a low of $1867 yesterday but was supported by 20EMA, and to rebound close to the previous day’s high at $1886.55. 20EMA remains bullish and is hinting at a bullish price trend. MACD has a divergence warning of a possible price high. Stochastic is declining and hinting at a price decline. We see a price correction before it resumes its upside momentum again.

Support1878.501867.701856.90
Resistance1892.251910.001928.70

AUD/JPY – Price reached a high of $91.65 yesterday morning which is almost near to this week’s high at $91.80. Price has since fallen to a low of $90.91 as of writing which hit our stop-at cost at $91.05. We are out of this position with no profit or loss. The price has moved below the 20EMA, hinting at a change in trend. Both MACD and Stochastic are moving lower and hinting at a price decline. If our next support $90.75 is violated, we are likely to see the price decline to $90.30 in the next few days.

Support90.7590.3089.80
Resistance91.6592.1092.40

FX Commentary – U.S. Dollar Slumped To A 7-Month Low On Slower Pace of US Rate Hikes

Nicholas

Market Talk
– The U.S. dollar on Monday slid to a seven-month low against the euro as traders bet recent economic data would prompt the Federal Reserve to slow the pace of interest rate hikes, while riskier currencies benefited from China reopening its borders.

– The euro was up 0.96% at $1.0747, its highest level versus the greenback since June 9, adding to Friday’s 1.17% increase. Sterling surged 0.87% to $1.2197 against the dollar, building on Friday’s 1.5% rally.

– The Japanese yen failed to gain despite Treasury yields slipping to a 3-week low amid ongoing expectations that the Federal Reserve will slow its pace of rate hikes.  The yen was last at 131.48 on Tuesday morning in Asian trading.

– The Aussie stood at $0.6907, having hit a five-month peak of $0.6950 overnight, amid hopes for a rebound in China’s reopening economy. The kiwi dollar had levelled out at $0.6364, after reaching a one-month top of $0.6411.

– Gold prices cooled slightly to $1870.45 per ounce on Tuesday after hitting an eight-month high on Monday, as a weak dollar’s boost was offset by Federal Reserve officials reiterating their aggressive stance against inflation.


Chart Focus AUD/USD

Key Points

1. Buy AUD/USD recommendation.

2. Buy AUD/USD at 0.6875. Stop at 0.6850 and profit order at 0.6945.

3. Expectation of a slower pace of interest rate hike and re-opening of China are both likely to aid the Aussie dollar.

4. Price is likely to be supported by the previous resistance turned support line with MACD hinting at a bullish price trend.

Fundamental Comments

1. Expectation of a slower pace of interest rate hike is likely to weigh on the U.S. dollar.

2. Re-opening of China and a lift of a coal ban are both likely to aid the Aussie dollar.

Technical Comments

1. Price is likely to be supported by the previous resistance turned support line.

2. MACD remains bullish and is hinting at a bullish price trend.



Key Levels

Support0.69000.68700.6825
Resistance0.69500.69850.7010








Technical Overview

USD/JPY – Price declined to a low of 131.30 on Monday which was just below the 62% Fibonacci correction point of the rally from 129.50 to 134.76. If price can stay above the 62% correction point, we are likely to see another test to 134.75 but if price were to be capped at 132.15, price is likely to decline to 129.50. Stochastic is in the oversold zone and MACD is about to turn up but 20EMA remains bearish. We prefer to remain bearish for 129.50.

Support131.50131.00130.50
Resistance132.15132.60133.20

EUR/USD – Price moved to a high of 1.0760 on Monday and looks likely to continue higher. However, stochastic is in the overbought zone and is hinting at a price decline. 20EMA and MACD are both bullish and hinting at a bullish price trend. We are likely to see a price correction to 1.0690 and from this support, we are likely to see the bullish price trend resumes it rally to 1.0815 in the next few days.

Support1.07201.06801.0645
Resistance1.07601.07901.0815

GBP/USD – Price reached a new low at 1.1842 on Friday but had rallied on the back of a weaker US dollar to a high of 1.2150 on Tuesday’s morning. Stochastic is in the overbought zone and is hinting at limited upsides. However, both MACD and 20EMA are bullish and hinting at a bullish price trend. We are in favour of a price rally to 1.2205 in the next few days ahead. A break below 1.2060 would negate our bullish view.

Support1.21501.21101.2070
Resistance1.21801.22101.2240

XAU/USD – Price reached a high of $1881.36 on Monday and the rally looks like it can continue higher. There are no divergences warnings from the MACD or stochastic indicators. Both MACD and 20EMA are hinting at a strong bullish price trend. However, the stochastic indicator is in the overbought zone. We think price can continue higher to $1900 in the next 48 hours. Below $1860 would negate our bullish price view.

Support1869.501856.901843.70
Resistance1885.701896.201916.45

AUD/JPY – We can a buy recommendation yesterday at 91.05, which was filled when price declined to a low of 90.84. Our view remains unchanged. We would recommend keeping stop at 91.70 and profit order at 91.95. Stochastic is declining after reaching the overbought zone but 20EMA is still hinting at a bullish price trend. MACD could be forming a divergence warning with price and this is our biggest worry.

Support90.8590.4590.15
Resistance91.3091.8092.05


FX Commentary – U.S. Dollar Weakened After NFP Data

Nicholas

Market Talk
– The U.S. dollar fell on Friday after U.S. jobs data showed a strong, but not blockbuster employment picture in December, while a separate report showed that U.S. services industry activity contracted for the first time in more than 2-1/2 years that month, offering more evidence that inflation was abating.

– Data showed on Friday that the U.S. economy added jobs at a solid clip in December, as the U.S. labour market remains tight, but Fed officials could draw some solace from a moderation in wage gains.

– The greenback extended losses after the Institute for Supply Management (ISM) said its non-manufacturing PMI dropped to 49.6 last month from 56.5 in November. It was the first time since May 2020 that the services PMI fell below the 50 threshold, which indicates contraction in the sector that accounts for more than two-thirds of U.S. economic activity.

– The euro gained 1.19% to $1.0645 and was on track for the biggest percentage daily increase since Nov. 11. The dollar fell 1.03% against the Japanese yen to 132.07. The British pound gained to a high of 1.2065.

– Gold prices edged higher to $1868.90 per ounce on Monday and hovered near a seven-month high, supported by a weaker dollar and hopes that the Federal Reserve might slow its pace of interest rate hike.


Chart Focus AUD/JPY

Key Points

1. Buy AUD/JPY recommendation.

2. Buy AUD/JPY at 91.05. Stop at 90.70 and profit target at 91.95.

3. The lifting of a coal ban and interest rate differential are both in the Aussie dollar favour.

4. Price is supported by a previous resistance turned support line with MACD also hinting at a bullish price trend.

Fundamental Comments

1. The lifting of a coal ban from China is aiding the Aussie.

2. Interest rate differential is in the AUD dollar favour.

Technical Comments

1. Price is likely to be supported by a previous resistance turned support line.

2. MACD remains bullish and is hinting at a bullish price trend.



Key Levels

Support91.0090.5090.15
Resistance91.6092.0092.40









Technical Overview
USD/JPY – Price has declined to a low of 131.30 this morning which is just below the 62% Fibonacci correction point of the rally from 129.50 to 134.76. Stochastic is still declining and hinting at a price decline but MACD remains bullish. 20EMA is hinting at a bearish price trend. Watch out for the Fibonacci 62% point at 131.30. This point is likely to determine the next direction of this pair.

Support131.30130.70130.35
Resistance131.95132.30132.95

EUR/USD – Price has reached a low of 1.0480 on Friday but that low was accompanied by a divergence warning from the MACD indicator. We have seen a rally to 1.0688 this morning and we are likely to see this rally continue higher to 1.0712 in the next 24 hours. Stochastic is not in the overbought zone as yet and 20EMA and MACD are both hinting at a strong bullish price trend.

Support1.06751.06301.0590
Resistance1.07151.07851.0830

GBP/USD – Price reached a new low at 1.1842 on Friday but had rallied on the back of a weaker US dollar to a high of 1.2150 on Monday morning. Stochastic has yet to reach the overbought zone, hinting that this rally can continue. 20EMA is also hinting at a strong bullish price trend. MACD confirms the bullish price trend. The next price resistance could be at 1.2260.

Support1.21101.20701.2030
Resistance1.21651.22251.2260

XAU/USD – Price reached a high of $1879.20, exceeding our target at $1878. However, MACD is not showing any divergences at the moment, hinting that this price rally may continue. Stochastic is not yet in the overbought zone, hinting that price can continue its rally. 20EMA is also showing a strong bullish price trend. We think price can continue higher to $1900 in the next 48 hours. Below $1860 would negate our bullish price view.

Support1869.501856.901843.70
Resistance1885.701896.201916.45

EUR/AUD – We had a sell recommendation last Friday at 1.5585, which was filled when price moved to a high of 1.5592. Our profit order at 1.5415 was also filled when price reached a low of 1.5398 at the point of this writing. We made 170 pips out of this trade, covering the 3 losses we had in the first 3 trades of the year. MACD is starting to show divergence, hinting at a possible price low.

Support1.53751.53351.5275
Resistance1.54451.54951.5570