Weekly Forex Analysis 22/04 – 28/04/2019

Long holiday is awaiting in Japan

USD/JPY continues to be in range at a rate of 112 yen, but there is no noticeable movement, and hard to participate. Meanwhile, the “very large holiday” which has never been seen before in Japan, which is 10 consecutive holidays, will begin this weekend.

Now let me show you how investors in Japan see the situation.

Some marketers stated “USD/JPY is subject to speculation and may fluctuate significantly,” and others say “it does not move much” and looks like it’s already entered its preliminary stages. In fact, I started to get some inquiries from investors today. I think that the dollar plunging of January 3rd this year still remains in their head.

Personally, I think such a move is unlikely to happen again, but we have some important events and economic news during the holidays, so there still might be a possibility of having high volatility while Japan’s big holiday. Market participants’ stress seems to have accumulated considerably, as there has been a period of steady market activity (meaning the orders, stop loss and IFO orders are relatively high).

Some significant US economic news

One of the major news this week in the US will be the “US January-Q3 GDP preliminary figures” which will be released on the 26th. Also, in Japan the BOJ Monetary Policy Meeting will be held on the 24th and 25th, and this time the “Forecast Report” will also be released. I think there will be no change in monetary policy, but according to Bloomberg’s survey, more economists are expecting a review of forward guidance.

BOJ (Bank of Japan) statement

BOJ President Kuroda also said, “If necessary, further monetary easing will not resign.” On the 26th and 27th, the Japan-US Summit Meeting will be held, and in conjunction with this meeting, the Finance Ministers of Japan and the United States may discuss the “exchange clause” of the Japan-US goods. 

Whether you expect or not, fundamental news always has possibility to become a big trigger for market’s volatility. Continue to beware of the sudden price action!