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USD/JPY forex signal - Triangle Breakout - 19 Mar 2018

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Signal Details
Entry Price: 
105.90
Take Profit: 
107.33
Stop Loss: 
105.58
Direction: 
Buy
Result: 
Loss
How we trade
5/5 of 5 ratings

The USDJPY currency pair has been in a steep downtrend but quite recently, price action looks to be forming a bottom around the 105.00 levels since the consolidation started around mid-February and continues. The declines in the USDJPY come from a number of factors.

For one, investors are concerned that the protectionist trade policies being undertaken by the current U.S. administration could weaken the U.S. dollar considerably and could spark a global trade war. Although nothing has been confirmed yet, there have been some nations that expressed displeasure with the policies.

Politics has also seeped into the currency markets with the recent sacking of key officials by President Trump which is expected to further consolidate his power and having like minded individuals in key positions.

The risk aversion has hit the USDJPY which has led to the Japanese yen strengthening as a result. From Japan, investors are bracing for potential signs of tightening from the Bank of Japan.

Although inflation still remains a long shot away from the BoJ's two percent inflation target rate, the recent uptick in consumer prices has led many to speculate that the next policy move from the BoJ could be one of tightening rather than expanding the QE program even further.

Combining the events, it is quite clear how the USDJPY has been in a decline since late last year.

The currency pair has been showing signs of forming a bottom around the 105.00 – 105.50 level in recent weeks. This consolidation has led to prices moving in a range and forming a symmetrical triangle at the bottom end of the rally. Therefore, we expect to see a near term pullback to this consolidation that could result in an upside surprise.

We are looking to be positioned on the long side, with entry at 105.90 targeting 107.33 near the recent highs that were formed. Stops can be placed around the recent lows formed at 105.58 level.

forex signal usdjpy 19 mar 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. He has no business nor personal relationships with any mentioned government entities or stocks. 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.