Now that the Japanese lower house elections are over, trader focus is being placed on the Bank of Japan’s monetary policy decision – taking place over the next two days. This decision will be important one for the underlying currency, which continues to lose against the US dollar. Since the beginning of the election campaign, LDP leader Shinzo Abe has run on the platform for further monetary easing in boosting economic growth. As a result, central bank leaders have been under extreme pressure from Abe supporters in expanding monetary policy – currently totaling $1.1 trillion.
And, now that Abe has won, further accommodation is anticipated. Expectations are now for the Bank of Japan to leave interest rates near zero, while expanding monetary policy by another $1 billion. Such a move may ultimately jeopardize the independence of the Bank of Japan, as policymakers would be falling into line with the political agenda. Incidentally, traders will be looking for a change in the inflation target set by the central bank – potentially raising it to 2% from the current 1%. This is another Abe policy that was promised as the government attempts to alleviate the current deflationary environment. -FXstreet.com
Upwards scenario: The initial uptrend formation might be resumed later on today. Possible intraday targets locate at 1.3252 (R2) and 1.3274 (R3), in case of successful penetration above the next resistance level at 1.3231 (R1). Downwards scenario: Market still had the chance to retest the key support level at 1.3188 (S1). Any further easing below it would then face supportive measures at 1.3166 (S2) and 1.3144 (S3) in potential.
Resistance Levels: 1.3231, 1.3252, 1.3274
Support Levels: 1.3188, 1.3166, 1.3144
GBPUSD
HIGH1.62614
LOW1.62382
BID1.62509
ASK1.62517
CHANGE0.04%
TIME08:12:59
OUTLOOK SUMMARY
Down
TREND CONDITION
Downward
penetration
TRADERS SENTIMENT
Bearish
IMPLIED VOLATILITY
Medium
Upwards scenario: The pair might keep general upside move intact after possible consolidation ahead. Appreciation above the next resistance at 1.6263 (R1) would enable next targets at 1.6276 (R2) and 1.6289 (R3) in potential. Downwards scenario: In regard to the descending movement, opportunities for bearish oriented traders are seen below the support level at 1.6238 (S1). Loss here would enable next targets at 1.6225 (S2) and 1.6211 (S3).
Resistance Levels: 1.6263, 1.6276, 1.6289
Support Levels: 1.6238, 1.6225, 1.6211
USDJPY
HIGH84.384
LOW83.859
BID83.983
ASK83.986
CHANGE-0.49%
TIME08:13:00
OUTLOOK SUMMARY
Down
TREND CONDITION
Downward
penetration
TRADERS SENTIMENT
Bearish
IMPLIED VOLATILITY
Medium
Upwards scenario: Our next resistance level is placed at 84.23 (R1), break above it might extend gains towards to next targets at 84.34 (R2) and 84.47 (R3) in potential. Downwards scenario: Instrument has settled negative bias on the hourly timeframe and we expect gradual decline towards to our support levels. Next attractive support level locates at 83.84 (S1). Break here is required to put in focus lower target at 83.72 (S2) and 83.59 (S3).
Resistance Levels: 84.23, 84.34, 84.47
Support Levels: 83.84, 83.72, 83.59
Disclaimer
The analysis we provide is based on the average estimate of price movements in one day. Does not guarantee what we deliver is actually a proper and correct. Everything that happens in the decisions you make on your trading transaction is to be Your responsibilities.
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