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Fundamental Overview
Following the resignation of the White House economic adviser, Gary Cohn, on Wednesday, 7th of March, it has been observed that the Asian stocks have been on both sides. Cohn quitted few hours after his disagreement with the U.S. president Donald Trump regarding the tariffs plans.
After Cohn’s resignation, we may observe some action in the market, such as, the S&P 500 rose by 0.26%, the Dow gained 0.04%, NASDAQ Composite is up by 0.5%, and the DOW added 0.04%. Now, the Yen seems to gain more power after this uncertainty, provided that Trump follows through with his tariff proposals after all. The monetary policy of Japanese Central Bank will be determined by the end of this week.
Technical Overview
The technical analysis of the YEN is supported by the fundamentals for a potential bullish momentum. For the time being, USDJPY is presenting a strong downtrend, supported by the confirmed bearish Kumo break out. Kijun Sen and Tekan Sen Chikou spans are out of the Kumo which could be another indication that the downtrend might continue.
The Chikou span is out of the price with no signs of weakening for now, and the cloud is holding strong to the downside. Potential signals for entry could be the bounce back on Kijun Sen and sell the reversal. Another potential signal could be the cross of Tekan Sen and Kijun Sen or the price bounce on the cloud Span A.
Now, to refine our potential entry we should look at the 1h timeframe for a reversal to the upside and wait for the price to go back, below the Kumo so that to have a potential valid Kumo breakout to the downside.
About the Author:
Marios Athinodorou is TeleTrade’s market analyst and commentator. Apart from being an experienced trader, Marios is an advanced technical analyst and is interested in trading psychology. He has 7 years of trading expertise in Forex and CFDs, providing insights to share with all kinds of traders, from beginners to experts.
Among other, Marios is delivering weekly trading webinars. Sign up to upcoming webinars, here.