Technical Analysis

USD/JPY patrons get a lift from Kuroda feedback, can they maintain the momentum going?

USD/JPY inches above the 100-hour shifting common

USD/JPY H1 19-02

That alerts that the near-term bias is now extra bullish as worth holds above each key hourly shifting averages. Nonetheless, I would not think about it a win for patrons simply but as worth is not breaking away in a big method simply but.

BOJ governor Kuroda’s feedback earlier nudged the yen decrease however all in all, it is robust to argue that this represents a big change in financial coverage stance by the central financial institution. They’ve at all times talked about that they’ve a number of instruments for disposal if they should pursue extra easing measures so for my part, this is not a big sport changer by way of a basic perspective.

That stated, it did set off a slight change in near-term sentiment and that is the extra necessary factor to take a look at. Worth is constant to carry simply above the 100-hour MA (purple line) now as we start European morning commerce however with out additional catalysts i.e. modifications in danger sentiment, I do not see an actual break on the playing cards for patrons right here.

In the intervening time, it is all about US-China commerce talks and the way markets derive sentiment from that. Therefore, even a transfer again in direction of 111.00 could be met with skepticism at this level with out the backing of danger/equities. 

With equities and Treasuries fairly flat on the day, I do not see how it will transfer the yen additional to the draw back all an excessive amount of. If worth strikes again in direction of 111.00 simply on the again of Kuroda right here, it might be a great space to fade the transfer for my part.

However simply be cautious of any modifications in danger sentiment that might reaffirm a transfer increased in any case. If markets flip risk-on later within the day, patrons will have the ability to declare a small win whatever the nudge increased from Kuroda.

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