[FOREX NEWS] Deutsche Bank predicts USD/JPY to rise

Dollar/yen suffered on the Trump Dump, but could turn to a new direction.

Here is the view from Deutsche Bank, courtesy of eFXnews:

We expect USD/JPY to rise to 120-125 yen (after a near-term correction to 110-115) as US fiscal policy boosts economic growth to 3-4% from late 2017 through 2018, and [...]

via Forex Crunch

[FOREX FORECAST] USDJPY Weekly – 23rd to 27th Jan 2017

USDJPY Weekly Forex Forecast – 23rd to 27th Jan 2017

Technical Outlook: USDJPY retraced last week as noted but the depth of the retracement has been shallow. Price retraced to only near 115.35 rather than the expected 116.00 level. Still, the retracement came on a hidden bearish divergence back to the support level which was tested for resistance. The following declines will now likely to continue towards the previous low formed near 112.70. Failure to decline to 112.70 could mean a sharper correction. Therefore, if USDJPY pulls back above 115.35 then expect the gains to push the dollar towards 116.00 – 116.50 region. Alternately, to the downside, look for USDJPY to retest 112.70 with the potential to post new declines down to 111.275 marking the initial support level.


Fundamental Outlook: A busy week from Japan next week, economic data focuses on preliminary PMI numbers for the month of January. Later in the week, inflation figures will be coming out. The BoJ’s measure of core CPI is expected to continue to remain weak, rising only 0.1%, compared to the 0.2% increase seen the month before. The Tokyo core CPI and the national core CPI are both forecast to continue to decline. However, there could be an upside surprise considering that higher energy prices have sent inflation higher across some of the major economies.


Previous USDJPY Weekly Forex Forecast

TLDR: Bearish

from Advanced Forex Strategies

[FOREX NEWS] President Trump speaks – JPY flies, MXN sinks

President Donald Trump sounds angry in his speech, talking about America First. His speech is full with nationalism. He talks about “buy America, hire America”. At least he also talks about building infrastructure, an important part that was missing from his recent press conference. His speech is full of patriotism and lashes against the establishment, saying that empty talk is over. [...]


via Forex Crunch

[FOREX 101] Currencies come in pairs

To make matters easier, forex markets refer to trading currencies by pairs, with names that combine the two different currencies being traded, or “exchanged,” against each other.

Additionally, forex markets have given most currency pairs nicknames or abbreviations, which reference the pair and not necessarily the individual currencies involved.


Major currency pairs

The major currency pairs all involve the U.S. dollar on one side of the deal. The designations of the major currencies are expressed using International Standardization Organization (ISO) codes for each currency. Table 2-1 lists the most frequently traded currency pairs, what they’re called in conventional terms, and what nicknames the market has given them.

EUR/USD Eurozone*/U.S. Euro-dollar N/A
USD/JPY U.S./Japan Dollar-yen N/A
GBP/USD United Kingdom/U.S. Sterling-dollar Sterling or Cable
USD/CHF U.S./Switzerland Dollar-Swiss Swissy
USD/CAD U.S./Canada Dollar-Canada Loonie
AUD/USD Australia/U.S. Australian-dollar Aussie or Oz
NZD/USD New Zealand/U.S. New Zealand-dollar Kiwi

* The Eurozone is made up of all the countries in the European Union that have adopted the euro as their currency.


Major cross-currency pairs

Although the vast majority of currency trading takes place in the dollar pairs, cross-currency pairs serve as an alternative to always trading the U.S. dollar. A cross-currency pair, or cross or crosses for short, is any currency pair that does not include the U.S. dollar. Cross rates are derived from the respective USD pairs but are quoted independently.

Crosses enable traders to more directly target trades to specific individual currencies to take advantage of news or events.

For example, your analysis may suggest that the Japanese yen has the worst prospects of all the major currencies going forward, based on interest rates or the economic outlook. To take advantage of this, you’d be looking to sell JPY, but against which other currency? You consider the USD, potentially buying USD/JPY (buying USD/selling JPY) but then you conclude that the USD’s prospects are not much better than the JPY’s. Further research on your part may point to another currency that has a much better outlook (such as high or rising interest rates or signs of a strengthening economy), say the

Australian dollar (AUD). In this example, you would then be looking to buy the AUD/JPY cross (buying AUD/selling JPY) to target your view that AUD has the best prospects among major currencies and the JPY the worst.

The most actively traded crosses focus on the three major non-USD currencies (namely EUR, JPY, and GBP) and are referred to as euro crosses, yen crosses, and sterling crosses. Table 2-2 highlights the most actively traded cross currency pairs.

EUR/CHF Eurozone/Switzerland Euro-Swiss
EUR/GBP Eurozone/United Kingdom Euro-sterling
EUR/JPY Eurozone/Japan Euro-yen
GBP/JPY United Kingdom/Japan Sterling-yen
AUD/JPY Australia/Japan Aussie-yen
NZD/JPY New Zealand/Japan Kiwi-yen