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Forex pairs in this Article » EUR/USD, GBP/USD, USD/JPY
- Japanese Yen remains our trading focus for the week ahead

- Our sentiment-based trading strategies are positioned to sell JPY

- Low forex volatility prices favors range trading in other pairs

The Japanese Yen remains the worst-performing major currency, and our sentiment-based trading strategies remain well-positioned to sell into JPY weakness.

Why is the Japanese Yen our focus for the week ahead? Despite extraordinarily low volatility expectations in the US Dollar and European currencies, the Yen stands apart and looks likely to see big moves despite the North American holiday.

To that end we’ll watch JPY trades via the Momentum2 trading system as it continues to buy into USDJPY and JPY-cross rate gains. Past performance is NOT indicative of future results, but we think the strategy could continue to do well amidst strong Yen declines.

Forex Volatility Prices Remain Extraordinarily Low Amidst Slow USD Moves

forex_japanese_yen_trading_week_ahead_body_Picture_1.png, Japanese Yen Remains our FX Trading Focus for Week AheadSource: OTC FX Options Prices from Bloomberg; DailyFX Calculations

Beyond JPY pairs, low volatility favors our range-trading Range2 system. A view at FX options markets shows 1-week volatility prices are near their lowest levels since 2006. Until we see a turn in forex vols, there’s little reason to expect larger US Dollar price swings.

See full detail on our trading biases in the table below, and sign up for e-mail updates via my distribution list for any changes.

DailyFX Individual Currency Pair Conditions and Trading Strategy Bias

forex_japanese_yen_trading_week_ahead_body_Picture_2.png, Japanese Yen Remains our FX Trading Focus for Week Aheadforex_japanese_yen_trading_week_ahead_body_Picture_3.png, Japanese Yen Remains our FX Trading Focus for Week AheadAutomate our SSI-based trading strategies via Mirror Trader free of charge

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