In today’s live webinar we went through the fundamentals, reviewed the usual charts, Thinus reviewed the M2 setups and I showed how we could play the Earth and Sky pairs this week.
The Bank of Japan (BOJ) has been warning for weeks that they have been watching the FX markets. They have repeated the same things almost every day for 3 weeks in a row. They said they don’t prefer the YEN weakening too much as this affects their economy and will take appropriate action if necessary. Well talking the market down strategy didn’t really work for them and the market kept selling the YEN against the USD.
This bought the price of USDJPY to all-time highs at Almost 152. A price it’s never been before for more than 20 years. BOJ finally intervened in the markets on Friday which moved USDJPY around 500 pips in one day! Also, the other cross-pairs ended up dropping against the YEN. As you might know by now the YEN pairs are positively correlated. So if USDJPY starts dropping usually the other cross pairs will have the same reaction.
So what to do?
The intervention didnt really work as buyers sold the YEN pushing the price back up to 149 now. Our advice considering the fundamentals would be to leave the YEN pairs alone for now and longing it might not be the best option right now. When you know the Bank doesn’t want to its currency to weaken further why would you try and go against that? so longing any pairs against the YEN does seem a risky option for now.
If you still prefer to long the pairs then I have shown you how you could do this using the Earth and Sky strategy.
We are NOT a “tipping service” our aim is to teach you how to trade for yourself.
You can see the full webinar below: