On Friday, inflation data will come out in Japan
In this review, we suggest considering the personal composite instrument (PCI) "Ruble vs. Yen". It reflects the price dynamics of the Russian ruble against the Japanese yen. The PCI grows in case of the strengthening of the ruble and the weakening of the yen. Is there a possibility for the RUBJPY to grow?
On the daily timeframe, RUBJPY: D1 came out from the downtrend. The further price increase is possible in case the Brent oil price remains above $50 per barrel and the Bank of Japan continues the policy of low rates and the yen emission.
- The Parabolic indicator gives a bullish signal.
- The Bollinger bands widened, which means higher volatility. They are tilted upwards.
- The RSI indicator is above 50. It has formed a positive divergence.
- The MACD indicator still gives a bullish signal.
The bullish momentum may develop in case RUBJPY exceeds the last fractal high at 1.867. This level may serve as an entry point. The initial stop loss may be placed below the last fractal low, the 9-month low and the Parabolic signal at 1.807. After opening the pending order, we shall move the stop to the next fractal low following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level at 1.807 without reaching the order at 1.867 we recommend cancelling the position: the market sustains internal changes that were not taken into account.
Summary of technical analysis:
| Position | Buy |
| Buy stop | Above 1,867 |
| Stop loss | Below 1,807 |