By FXEmpire.com
Introduction: In the USD/JPY trade, trying to pick tops or bottoms during that time would have been difficult. However, with the bull trend so dominant, the far easier and smarter trade was to look for technical opportunities to go with the fundamental theme and trade with the market trend rather than to trying to fade it.
Against the Japanese yen, whose central bank held rates steady at zero, the dollar appreciated 19% from its lowest to highest levels. USD/JPY was in a very strong uptrend throughout the year, but even so, there were plenty of retraces along the way. These pullbacks were perfect opportunities for traders to combine technicals with fundamentals to enter the trade at an opportune moment.
- The interest rate differential between the Bank of Japan(BoJ) and the Federal Reserve
- Japanese government intervention to maintain their currency sends USD/JPY lower
Weekly Analysis and Recommendation:
The USD/JPY is facing a triple whammy, with the drop in the USD as investors moved to more risk, the JPY was also under pressure, but also the political turmoil in Japan weighs on the markets. This is compounded by a mixed bag to eco data out of Japan. Retail sales and household spending soared while production and manufacturing continued to lag.
Prime Minister Noda this week pushed through an increase in consumption tax, much needed by the government and hailed by Moody’s as credit positive but at the cost of his political clout. His coalition is strained.
The EU grand plan will be considered by the markets over the weekend and we will see just how much they accept it on Monday’s trading. Markets were so surprised to see anything hardcore and immediate from the EU Summit that they were more in shock, as much of the week, it looked like it would be another meeting of talk and press and hopes and dreams with no results.
|
Date |
Open |
High |
Low |
Change % |
|
|
Jun 29, 2012 |
79.80 |
79.31 |
79.99 |
79.14 |
0.63% |
|
Jun 28, 2012 |
79.30 |
79.67 |
79.69 |
79.22 |
-0.47% |
|
Jun 27, 2012 |
79.67 |
79.47 |
79.87 |
79.36 |
0.26% |
|
Jun 26, 2012 |
79.47 |
79.66 |
79.79 |
79.24 |
-0.24% |
|
Jun 25, 2012 |
79.66 |
80.58 |
80.58 |
79.44 |
-1.14% |
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.
Major Economic Events for the week of June 25 – 29 actual v. forecast for Yen, the Aussie and the Kiwi
|
Date |
Currency |
Event |
Actual |
Forecast |
Previous |
|
Jun 26 |
NZD |
Trade Balance |
301M |
305M |
335M |
|
Jun 27 |
JPY |
Retail Sales y/y |
3.6% |
3.1% |
5.7% |
|
AUD |
HIA New Home Sales m/m |
0.7% |
6.9% |
||
|
NZD |
NBNZ Business Confidence |
12.6 |
27.1 |
||
|
Jun 28 |
NZD |
Building Consents m/m |
-7.1% |
-7.6% |
|
|
JPY |
Household Spending y/y |
4.0% |
2.5% |
2.6% |
|
|
JPY |
Tokyo Core CPI y/y |
-0.6% |
-0.7% |
-0.8% |
|
|
JPY |
Prelim Industrial Production m/m |
-3.1% |
-2.7% |
-0.2% |
|
|
AUD |
Private Sector Credit m/m |
0.5% |
0.5% |
0.4% |
Historical:
Highest: 108.00 on Sep 19, 2008
Average: 87.08over this period
Lowest: 75.58 on Oct 31, 2011
Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD
|
Date |
Time |
Currency |
Event |
Forecast |
Previous |
|
Jul 2 |
10:00am |
USD |
ISM Manufacturing PMI |
52.1 |
53.5 |
|
9:30pm |
AUD |
Building Approvals m/m |
5.1% |
-8.7% |
|
|
9:30pm |
JPY |
Average Cash Earnings y/y |
0.6% |
0.2% |
|
|
Jul 3 |
12:30am |
AUD |
Cash Rate |
3.50% |
3.50% |
|
10:00am |
USD |
Factory Orders m/m |
0.1% |
-0.6% |
|
|
7:30pm |
AUD |
AIG Services Index |
43.5 |
||
|
9:30pm |
AUD |
Retail Sales m/m |
0.3% |
-0.2% |
|
|
Jul 4 |
9:30pm |
AUD |
Trade Balance |
-0.51B |
-0.20B |
|
Jul 5 |
8:15am |
USD |
ADP Non-Farm Employment Change |
101K |
133K |
|
8:30am |
USD |
Unemployment Claims |
385K |
386K |
|
|
10:00am |
USD |
ISM Non-Manufacturing PMI |
53.1 |
53.7 |
|
|
11:00am |
USD |
Crude Oil Inventories |
-0.1M |
||
|
Jul 6 |
8:30am |
USD |
Non-Farm Employment Change |
92K |
69K |
|
8:30am |
USD |
Unemployment Rate |
8.2% |
8.2% |
Click here to read USD/JPY Technical Analysis.
Originally posted here
