How to trade the US Retail Sales with USD/JPY

  • The US Retail Sales Report and especially the Control Group is a top-tier figure and that impact the USD/JPY.
  • The Market Impact Tool shows trading opportunities in both upside and downside surprises on this event.
  • The USDJPY moved, on average, 30 pips in the 15 minutes after the data release and 50 pips in the following 4 hours.

Buying USD/JPY Scenario

  • Tradable Positive Trigger: +0.86 deviation (0.65%) [BUY Pair]
  • Key Resistance Level: 110.50

This time, if it comes out at higher than expected with a relative deviation of 0.86 or higher (0.65% or higher in actual terms), the pair may go up reaching a range of 41  pips in the first 15 minutes and 62 pips in the following 4 hours.

110.00 is a round number and remains a battleground. 110.50 capped the pair early in the year and also earlier in the week. 110.88 was the high point on June 13th. 111.40 was the peak on May 21st.

Selling USD/JPY Scenario

  • Tradable Negative Trigger: -1.02 deviation (0.1%)  [SELL Pair]
  • Fundamental Support Level: 109.50

If it comes out lower than expected at a relative deviation of -1.02 or less ( 0.1% or lower in actual terms), the USDJPY may go down reaching a range of 59 pips in the first 15 minutes and 93 pips in the following 4 hours.

109.50 was a stubborn cap in late April. 109.20 was a swing low on June 8th. 108.65 was a swing low on May 4th and 108.10 served as support on May 29th.

USD/JPY Levels on the Chart

USD JPY Technical analysis June 14 2018

More data

The US economy is centered around consumption, making the fresh retail sales report for May an important figure to watch. It is also a key component in GDP calculations. The Retail Control Group is the core of the core and is eyed by the Fed. Given the limited reaction to the rate decision, volatility could rise with the publication. 

See: US Retail Sales Preview: A tie-breaker after the Fed, but not for EUR/USD

In the last five releases, the USDJPY moved, on average, 30 pips in the 15 minutes after the data release and 50 pips in the following 4 hours. The previous release had a positive surprise of 0.00 in terms of relative deviation and the USDJPY reached a 31 pip range in the first 15 minutes and a range of 63 pips 4 hours thereafter. 

Follow the publication of the figure on the economic calendar. Watch out for the data from the Market Impact tool, projecting the potential price changes according to the deviation. Here is the Market Impact Studies Users Guide.

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