Technical analysis – Will CHF/JPY quotes continue to decline?

Dmitry Lukashov IFC Markets

CHF/JPY technical analysis summary

Below 137,4.

Sell Stop.

Above 147.

Stop Loss.

Indicator	Signal
RSI	Neutral
MACD	Sell
MA(200)	Neutral
Fractals	Sell
Parabolic SAR	Sell
Bollinger Bands	Neutral

CHF/JPY chart analysis

On the daily timeframe, CHFJPY: D1 is in a downtrend and has made a fresh low. A number of technical analysis indicators formed signals for further decline. We do not rule out a bearish movement if CHFJPY: D1 falls below the latest low and lower Bollinger band: 137.4. This level can be used as an entry point. The initial risk limit is possible above the last 2 upper fractals, the upper Bollinger band, the 200-day moving average line and the Parabolic signal: 147. After opening a pending order, we move the stop following the Bollinger and Parabolic signals to the next fractal low. Thus, we change the potential profit/loss ratio in our favor. The most cautious traders, after making a trade, can switch to a four-hour chart and set a stop loss, moving it in the direction of movement. If the price overcomes the stop level (147) without activating the order (137.4), it is recommended to delete the order: there are internal changes in the market that were not taken into account.

Fundamental analysis of forex – CHF/JPY

On January 18, 2023, the meeting of the Bank of Japan (BOJ) will take place. Will CHFJPY quotes continue to decline?

Such dynamics means the strengthening of the yen against the Swiss franc. The Japanese newspaper Yomiuri reported that at the next meeting, the BOJ may discuss the effectiveness of its policy in the government bond market (yield curve control policy (YCC). Its actions are viewed by investors as a tightening of monetary policy and contribute to the strengthening of the yen. Recall that at the end of December 2022, the BOJ expanded its YCC yield range for the first time, pushing the Japan 10-Year Bond yield up from 0.25% to 0.5% pa and appreciably strengthening the yen. It could reach 132 billion Swiss francs ($143 billion). This may have a negative impact on the Swiss franc. It should be noted that on January 19 in Japan the trade balance will be released and on January 20 - inflation. In Switzerland, January 19 will be published producer price index.

Want to get more free analytics? Open Demo Account now to get daily news and analytical materials.

Author

Dmitry Lukashov

IFC Markets

Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.

EUR/USD: US Dollar to remain pressured until uncertainty fog dissipates

Unimpressive European Central Bank left monetary policy unchanged for the fifth consecutive meeting. The United States first-tier employment and inflation data is scheduled for the second week of February. EUR/USD battles to remain afloat above 1.1800, sellers moving to the sidelines.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold: Volatility persists in commodity space

After losing more than 8% to end the previous week, Gold remained under heavy selling pressure on Monday and dropped toward $4,400. Although XAU/USD staged a decisive rebound afterward, it failed to stabilize above $5,000. The US economic calendar will feature Nonfarm Payrolls and Consumer Price Index data for January, which could influence the market pricing of the Federal Reserve’s policy outlook and impact Gold’s performance.

Week ahead: US NFP and CPI data to shake Fed cut bets, Japan election looms

US NFP and CPI data awaited after Warsh’s nomination as Fed chief. Yen traders lock gaze on Sunday’s snap election. UK and Eurozone Q4 GDP data also on the agenda. China CPI and PPI could reveal more weakness in domestic demand.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.