Long USD/JPY idea into BOJ and Fed meetings
Zaktualizowano
BOJ rates pricing is as hawkish as it’s been since before the GFC. At the same time, expectations for rate cuts from the Fed over the next 12 months are nearing levels seen in January.
For a FX pair with a rolling daily correlation of 0.95 over the past month with two-year yield spreads between the US and Japan, it suggests there is only limited scope for narrowing interest rate differentials to drive further downside in USD/JPY over the near-term.
When you look at the daily chart, with USD/JPY nearing key support at 151.95 and divergence between RSI and price warning of waning downside momentum, risk-reward appears skewed towards initiating longs heading into the BOJ and Fed meetings later today.
Should we see USD/JPY push towards 151.95, consider going long with a tight stop below the level for protection. Probes higher over the past week have stalled above 154.54, making that a potential initial trade target. Should 155.375 be taken out, the next target would likely be the important 50-day moving average.
Should the trade move in your favour, consider lifting your stop loss or using a trailing stop to protect against reversal. Good luck!
DS
For a FX pair with a rolling daily correlation of 0.95 over the past month with two-year yield spreads between the US and Japan, it suggests there is only limited scope for narrowing interest rate differentials to drive further downside in USD/JPY over the near-term.
When you look at the daily chart, with USD/JPY nearing key support at 151.95 and divergence between RSI and price warning of waning downside momentum, risk-reward appears skewed towards initiating longs heading into the BOJ and Fed meetings later today.
Should we see USD/JPY push towards 151.95, consider going long with a tight stop below the level for protection. Probes higher over the past week have stalled above 154.54, making that a potential initial trade target. Should 155.375 be taken out, the next target would likely be the important 50-day moving average.
Should the trade move in your favour, consider lifting your stop loss or using a trailing stop to protect against reversal. Good luck!
DS
Uwaga
Lift stop to entry level if you got in around the session lows. Let's see what the BOJ has to say, whenever it decides to grace us with its decision.
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