USD/JPY constrained below 114.00 ahead of FOMC policy decision [Video]

Christina Parthenidou XM

USDJPY has been constrained between the support-turned-resistance trendline and the 20-day simple moving average (SMA) over the past week, unable to clearly close above the 114.00 level ahead of the FOMC policy announcement.

The upward slope in the shorter-term SMAs is endorsing the bullish market structure from September’s lows, but the momentum indicators are foreseeing depressed trading in the coming sessions. Specifically, the RSI continues to make lower highs and lower lows towards its 50 neutral mark, the MACD remains negatively charged below its red signal line, while the Stochastics seem to be pivoting southwards again, all reflecting a gloomy mood in the market.

Nevertheless, the focus will remain on the supportive 20-day SMA at 113.80, a break of which could bolster selling interest towards the 23.6% Fibonacci of the 109.11 – 114.69 upleg at 113.37. A more aggressive decline could reach the 113.00 round number, while lower, the bears may head for the 38.2% Fibonacci of 112.56. Yet only a sustainable move below the 112.00 bar and the 50% Fibonacci would downgrade the broader outlook back to neutral.

Should the 20-day SMA stand firm, with the price also closing above the red Tenkan-sen line once again, the bulls may advance to challenge the 114.45- 114.69 ceiling. Another extension higher from here may then encounter the 2017 boundary of 115.50.

In brief, the technical picture is currently looking discouraging for USDJPY, with selling forces expected to intensify below 113.80.

Author

Christina Parthenidou

Christina joined Trading Point in May 2017. She holds a master degree in Economics and Business from the Erasmus University Rotterdam with a specialization in International economics.

GBP/USD stays offered near 1.3370

GBP/USD remains on the back foot, slipping back toward the 1.3370 zone on Tuesday. Cable has come under pressure soon after testing the 1.3400 neighbourhood as investors turned more cautious in response to renewed effervescence on the geopolitical front.

EUR/USD stays offered below 1.1450

EUR/USD remains on the back foot ahead of the opening bell in Asia, returning to the low-1.1400s on the back of the resurgence of the demand for the US Dollar. Indeed, renewed jitters in the Middle East support the safe haven universe and weigh on the sentiment surrounding the risk complex. Moving forward, investors’ attention should shift to Wednesday’s FOMC Minutes.

Gold weakens toward $4,100

Gold adds to Monday’s decent pullback and trades close to the $4,100 mark per troy ounce on Tuesday. In the meantime, fresh geopolitical effervescence appear to have reignited inflation concerns, which in turn, limit any recovery attempt from the precious metal.

Ondo launches Perps with 20x leverage on tokenized stocks

Ondo Finance has expanded its financial services suite to include perpetual futures contracts for tokenized stocks. The platform, referred to as Ondo Perps, will provide 24/7 trading and over 20x leverage, utilizing tokenized stocks as collateral.

Bye, forward guidance: How to trade when central banks choose silence

Central banks have spent years telling markets what might come next. Now, traders face the possibility that they say a lot less. From the Federal Reserve to the European Central Bank and the Bank of England, policymakers are pushing back against forward guidance, arguing that the current world demands more flexibility.