logo
  Join        Login             Stock Quote

How Will Yen Respond To More Stimulus?

 January 09, 2013 12:40 PM


Media is awash with talk about new economic stimulus in Japan. It seems the Japanese government is preparing a new supplementary budget, the largest in several years, ready to borrow as much as JPY 12 trillion. This would amount to about 2% of the nation's GDP, needed in an effort to boost the sagging economy. Officials call it a "flexible fiscal policy", which of course has additional aim of sparking inflation and more Yen depreciation.

It will be interesting how the Japanese currency responds to this round of spending. So far, the Yen is not weakening, in fact has been gaining in the last two past two days. All of the JPY currencies dropped well over 100 pips from their recent highs. One could argue that this is only a technical pullback, targeting the still open gaps from late December. At the same time, though, today's reports should have had some impact, especially if the markets are paying attention to fundamentals. We will find out the real impact once this new stimulus is officially approved.

[Related -Initial Jobless Claims Rose Unexpectedly]

In the last post, I discussed couple of Canadian Dollar pairs and one of them happened to be the CAD-JPY. After a long wait, it finally developed a topping pattern on the hourly chart. I moved the sell order to just under the new support of 88.69, to 88.67 to be exact. My objective for this trade was 88.00, as this level offers the next potentially strong support. It was reached almost to the pip, making for a nice trade.

[Related -All Quiet on the Record High Front]

Mike K.

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageInitial Jobless Claims Rose Unexpectedly

Claims unexpectedly rose in the latest report through last weekend to breach 300,000 for the first time read on...

article imageAll Quiet on the Record High Front

What can we glean from the media’s lack of attention to the market’s recent record read on...

article imageThe Chip Maker Short Sellers Should Be Watching

Investing in semiconductor stocks is always tricky. Industry cycles can lead to bumps in the road for the read on...

article imageChicago Fed: US Economic Growth Slowed In October

The pace of US growth slowed more than expected in October, according to this morning’s update of the read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.