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EUR/JPY trading signal - BoJ's Kuroda speech - 20 Jun 2018

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Signal details
Entry Price: 
Close Price: 
No Trade
Expiry Time: 
21:00 GMT
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A quiet day on the economic front in the markets will be offset by a number of key speeches from various central bankers. With the annual banking conference in Portugal kicking off, the day ahead will see speeches from various central bank heads including ECB's Draghi, BoJ's Kuroda and the Fed Chair, Jerome Powell.

The event is likely to spark some speculation in the markets considering that just over a year ago, central bankers had signaled that they would be embarking on a monetary policy tightening cycle.

Since June last year, currencies including the euro, the British pound sterling, the Canadian dollar had surged after various central bankers came out to give hawkish forward guidance. Today's line up of speeches could potentially shed light on the future course of monetary policy as a result.

Investors will be closely observing today's speeches for clues on the next steps in monetary policy guidance. Of importance will be the speech by the BoJ Governor Kuroda.

The Bank of Japan has remained the sole G7 central bank that had abandoned its time frame for reaching its inflation target. At the most recent BoJ monetary policy meeting, the central bank also gave up on its inflation target.

Consumer price expectation in Japan has remained subdued as noted by BoJ officials at last week's monetary policy meeting. Therefore, investors will be looking for any clues on what the Bank of Japan might do next.

Based on the above, today's trading signal is EURJPY. The currency pair was seen declining the past few weeks only to retrace the losses. In the short term, we expect the euro to retrace back to the previously breached support at 127.96 where resistance can now be established. We would expect the currency pair to eventually close lower on the day.

eurjpy trading signal 20 jun 2018

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion. All risks and coasts associated with online trading are your responsibility.