TriumphFX Forex Analysis – JPY Pairs – April & May 2020


AUDJPY Daily & 4 Hour Charts

AUDJPY Daily Chart
AUDJPY 4 Hourly Chart

As suggested in our last AUD chart analysis, price closed below the range support area and has since been bearish.

The AUDJPY is now clearly down-trending on the daily chart – price action has formed a series of lower swing lows and lower swing highs. The daily moving averages have crossed bearish and are widening, signalling that the downside direction may continue. Price is currently forming higher swing highs and higher swing lows on the 4 hour chart.

Selling opportunities could exist around the 61.8% Fib retrace area, around the dynamic resistance of the daily moving averages, around the daily trend resistance area, if the AUDJPY closes below the 4 hour trend support area and around the horizontal levels at 70.30, 71.40, 71.85, 72.40, 74.25, and 76.40. A bearish move may be rejected or reverse around the 4 hour moving averages, around the 4 hour trend support area and around the horizontal levels at 60.70, 62.75, 64.95 and 67.30.

The Reserve Bank of Australia (RBA) cut rates again in their April 2020 meeting. Rates were cut by a further 0.25%, bringing the official bank rate to 0.25% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate the economy due to COVID-19 recession fears. The RBA will continue to monitor the labour market and inflation. Rates will not be raised until targets are met.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

CADJPY Daily & 4 Hour Charts

CADJPY Daily Chart
CADJPY 4 Hourly Chart

CADJPY is looking very similar to CADCHF – clear daily downtrend and market indecision of the 4 hour. The 4 hour chart has also formed a diagonal support area, just like CADCHF. The daily moving averages have crossed bearish, suggesting that price may attempt a bearish move lower. Price may start ranging though between the recent lows at 74.75 and the horizontal resistance at 78.20.

Selling opportunities could exist around any of the key Fib levels, around the daily moving averages and around the horizontal levels at 78.15, 78.30, 78.70, 80.00 and 81.50. A bearish move may be rejected or reverse around the 4 hour diagonal support area and around the horizontal support levels at 75.25, 74.80 and 74.55.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

The Bank of Canada (BOC) followed the US by slashing it’s benchmark interest rate. The intent of the rate cut is to help boost the economy during the COVID-19 pandemic. The current rate is now 0.25%. The economy is currently performing well and inflation targets are currently at their potential. If coronavirus fears deescalate, the BOC could increase rates again in the near future.

EURJPY Daily & 4 Hour Charts

EURJPY Daily Chart
EURJPY 4 Hourly Chart

As suggested in our last EUR chart analysis, price has been bearish and has continued to reverse around the daily trend resistance area.

EURJPY continues to be bearish but is potentially starting to range between the daily support at 116.10 and the daily resistance at 123.10. The moving averages are tight and moving sideways – confirming the potential indecision. Price is also ranging on the 4 hour chart (116.55-121.20). The moving averages are bearish and steady though, suggesting that EURJPY could break lower.

Trading opportunities may exist around the support and resistance areas of both ranges and if price moves out of either range (break-out trade).

The European Central Bank (ECB) continue to keep rates at the record low of 0.00%. Rates have not been cut into negative territory, despite the COVID-19 outbreak. Instead, the ECB has launched an asset buying program. Due to weak trade growth and economic forecasts, rates are likely to stay low for the foreseeable future. The COVID-19 pandemic is just another economic challenge for the Euro zone.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

GBPJPY Daily & 4 Hour Charts

GBPJPY Daily Chart
GBPJPY 4 Hourly Chart

Price is indecisive and is lacking clear trend direction. The moving averages on both time-frames confirm this – they are tight and have been crossing frequently. GBPJPY has formed a daily range at 125.80-148.30. The 4 hour has also formed a range at 132.35-135.35.

Trading opportunities may exist around the support and resistance areas of both ranges and if price moves out of either range (break-out trade).

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

USDJPY Daily & 4 Hour Charts

USDJPY Daily Chart
USDJPY 4 Hourly Chart

The daily time-frame is showing clear signs of market indecision – price action has been choppy and has been moving sideways. The daily moving averages confirm the indecision – they are tight and are moving sideways. The 4 hour time-frame is also indecisive.

Trading opportunities may exist around any of the horizontal levels at 102.25, 103.05, 104.80, 107.05, 109.20, 111.30 and 112.10.

The Federal Reserve has announced a record breaking stimulus package, aimed at US households and employers. The US Federal Open Market Committee (FOMC) has unexpectedly cut rates by 150 points due to heightened concerns regarding the COVID-19 outbreak. The current Fed Funds rate is currently 0.25%, back at post-2008 levels. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. The USD has been acting as a safe haven amid the COVID-19 outbreak. There are some concerns that the COVID-19 pandemic may hit the US hardest, causing a reversal of the recent USD strength.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.