Euro / Japanese YenShort
EUR/JPY and Japan's Pot. Policy Shft
Fundamentals:
This trade is a bet that Japan will make changes to its YCC in 2024 and interest rates.
On Tuesday, however, the BoJ kept interest rates at -0.1%, "while also sticking to its yield curve policy that references the 1% upper bound for 10-year Japanese government bonds as its limit."
The '"BOJ Governor Kazuo Ueda says more scrutiny needed to ascertain if a “positive” wage-inflation cycle has fallen in place." (cnbc.com/2023/12/19/boj-bank-of-japan-sticks-to-ultra-easy-monetary-policy-in-light-of-high-uncertainties.html)
The BoJ is closing monitoring Japan's wages. Wages are expected to rise. The yen going ahead will be sensitive to economic data related to wages.
Technicals:
Broke TL and found resistance @ the cloud upon retracement with hor. TL resistance confluence.
All 5 parts of the ichimoku cloud agree. However, there is some hesitation from the chikou as it bounces around in the cloud. It is something to be monitored over the coming week.
dRd with DQ
Conclusion:
It is yet to be seen is they will make a policy shift, but the potential is there. Wages should be monitored.
This trade is a bet that Japan will make changes to its YCC in 2024 and interest rates.
On Tuesday, however, the BoJ kept interest rates at -0.1%, "while also sticking to its yield curve policy that references the 1% upper bound for 10-year Japanese government bonds as its limit."
The '"BOJ Governor Kazuo Ueda says more scrutiny needed to ascertain if a “positive” wage-inflation cycle has fallen in place." (cnbc.com/2023/12/19/boj-bank-of-japan-sticks-to-ultra-easy-monetary-policy-in-light-of-high-uncertainties.html)
The BoJ is closing monitoring Japan's wages. Wages are expected to rise. The yen going ahead will be sensitive to economic data related to wages.
Technicals:
Broke TL and found resistance @ the cloud upon retracement with hor. TL resistance confluence.
All 5 parts of the ichimoku cloud agree. However, there is some hesitation from the chikou as it bounces around in the cloud. It is something to be monitored over the coming week.
dRd with DQ
Conclusion:
It is yet to be seen is they will make a policy shift, but the potential is there. Wages should be monitored.
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