USDJPY: Keep stops tight below 0.7390

Jim Langlands FX Charts

24 Hour: Neutral

Medium Term: Prefer to buy dips

Preferred Strategy: Against my better judgement it looks as though buying dips is the plan for now. Keep stops tight below 0.7390 though.

The Kiwi remained firm on Friday, following on from the mad words of the NZ Finance Minister who said he is unperturbed by the strong Kiwi which must have left the RBNZ and exporters tearing their hair out. The effect has been to see the Kiwi finish at 12 month highs, and above 0.7485 it would be trading at a 2 year high.

The momentum indicators look positive, and having closed above the 200 WMA for the first time since September 2014 further gains look possible, although 0.7485 will be a formidable hurdle. Beyond here though there is little to stop the Kiwi heading on towards 0.7550 and possibly even to 0.7740/45 (April 2015 high).

The downside seems well protected right now although the short term momentum indicators are at overbought extremes, with support coming in, below the 200 WMA at around 0.7400 and then again at 0.7370. Under there could see a return towards 0.7335 although this seems unlikely at this stage.

Economic data highlights will include:

M: Nikkei Flash Mfg PMI

T: BOJ Minutes

F: CPI, Unemployment, Retail Trade

Author

Jim Langlands

FX Charts

Jim Langlands began his trading career in the commodities markets in London in 1976, before moving to Australia in 1979 to work as a floor trader on the Sydney Futures Exchange.

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