Buy JPY or Sell Commodity Currencies

Posted On 07 Jan 2016

Our trade call today is to buy JPY or sell commodity currencies on a pullback. The prime pairs are CADJPY and AUDJPY. A pullback of over 70-100 pips in each of these pairs should be viewed as a potential opportunity to sell, provided there is not major news causing the upside.

Current Market Sentiment:

In the late NY session the FOMC minutes revealed that the decision to raise rates was a close call and some members saw serious risks to the inflation outlook. This prompted some mild selling in USD however does not alter the fundamental bullishness of the currency.

In the Asian session, Building Approvals from Australia missed expectations by a very wide margin, showing declines of -12.7% for the month of November. This is the biggest decline since August 2012. Accordingly, the Aussie fell 60 pips. The currency remains near lows of the day, also pressured by falls in crude prices along with the CAD and NZD.

Equity markets in China were again closed after the CSI 300 fell more than 7% for the second time this week. This fuelled buying in yen with USDJPY falling over 100 pips and AUDJPY down 150 on the day and 500 pips for the week.

There are no majors economic events due out today. We will be monitoring the newswires and price action. Direction will likely continue to be dictated by risk-off themes.

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Source:: Buy JPY or Sell Commodity Currencies

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Jarratt Davis is the world’s ranked #2 (2008-2013) Forex Trader by Barclays FX Hedge Index, following years of mastering his art as a self employed trader Jarratt has now entered the field of education and delivers the most robust Forex education package on the market. Jarratt’s mentorship is one of the only programs on the market that is conducted by a verified professional trader. Forex Alchemy readers can get the FREE mini course where Jarratt gives away some of his secrets to success by Clicking Here... [space height="20"] [social type="facebook"]www.facebook.com/JarrattDavisForex/[/social] [social type="twitter"]https://twitter.com/jarrattdavis[/social] [social type="google-plus"]https://plus.google.com/+JarrattdavisForexTrader/[/social] [social type="youtube"]https://www.youtube.com/user/JarrattDavisForex[/social]