The news feed in the current trading week will be very eventful. Leading central banks will make decisions regarding further monetary policies. Some important statistics will be published as well. At the moment, the dollar index (#DX) is holding monthly lows. Investors have taken a wait-and-see attitude.
The key event will be a two-day Fed's meeting, which will start on March 19. Previously, the regulator reported that it would not rush to raise interest rates in the current year. The US continues to publish weak economic releases. The 10-year US government bonds yield shows a negative trend. The figure has reached 2.59%-2.60%. A slowdown in the global economy, as well as uncertainty in the trade negotiations between Washington and Beijing, put additional pressure on the "greenback".
Most experts agree that the Fed will maintain its key interest rate range at the previous level of 2.25%-2.50%. The central bank will continue to adhere to a “patient” approach to tightening monetary policy. We recommend paying attention to the comments by the Central Bank representatives, as well as to updated economic forecasts. We do not exclude a further decline in the US dollar against a basket of world currencies.
Let's consider the current technical pattern on the USD/JPY currency pair.
- Support levels: 111.000, 110.000, 108.750
- Resistance levels: 112.000, 113.000, 114.100
- - the price has crossed 100 MA;
- - the MACD histogram is in the positive zone but has begun to decline.
There is an ambiguous technical pattern on the USD/JPY currency pair. The trading instrument is consolidating. At the moment, the key support and resistance levels are 111.000 and 112.000, respectively. The demand for the US currency has weakened. The USD/JPY quotes are tending to decline. Indicators do not send accurate signals:
We recommend opening positions from the key levels.
If the Fed publishes weak economic forecasts and points to a further "patient" approach to tightening monetary policy, it is necessary to look for market entry points to open short positions. The immediate goal for profit taking is the round level of 110.000.
Alternatively, the USD/JPY quotes may recover to 112.500-113.500.
When tracking positions, one should use a trailing stop.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.Open Account