BOJ with first comments on raising interest rates, where to look for profits

14.03.2018 / 03:02

Rating:

The moods among Bank Of Japan members remain in support of the weak Japanese yen. According to all members of the central bank, the achievement of the inflation target is a matter of time. Regarding quantitative easing, the bank's board believes that they should continue to take full effect, especially against the background of the risks of a trade war.

What is noteworthy in today's report is that for the first time some of the bank's members mentioned a shift in interest rates to higher ones, as economic data continues to improve.

Despite the published report and comments from BoJ on raising interest rates in the country, the JPY posted a decline over most currencies. Investors are still negatively affected by a change in monetary policy and reflect the strong incentives on the part of the bank.

Taking into account the current economic and political situation, we remain Long on JPY, and the temporary weakness gives us good levels for additional purchases. At the moment, Asia's stock markets are down sharply after Wall Street's Sell Off, and this will help JPY.

Technical GBP/JPY H4 gives us the best opportunity to trade. The price is in short Short Trend, now correcting to levels of horizontal resistance, formed by 38.2% Fibonacci correction, horizontal resistance level, internal diagonal and 200SMA. In addition to the short idea is DeMarker 8, which is located in the over-purchase area. Short of current levels will be capped at SL at 150.54 levels.

Alternative Scenario: If the price moves above the resistance zone and is able to stay there in several successive bars, the negative scenario will be spoiled, and we are more likely to see the pound growth against the JPY.

Jr Trader Petar Milanov

Varchev Traders

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BOJ with first comments on raising interest rates, where to look for profits

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