Jan 29th, 2016: Japan Turns Negative

• Yen pairs are rocketing higher this morning after the Bank of Japan opted to set negative interest rates in a shock move. Rates now stand at -0.1% in a bid to combat inflation and the rising yen. The yen pairs are the biggest movers, with the AUD/JPY pick of the bunch.

• Elsewhere, the US dollar is barely moving this morning underlining that this move is very much about the yen, not dollar strength.

• The Australian and New Zealand dollars continue their recovery as oil prices and other commodities stabilise.

• The euro is lagging however ahead of German retail sales at 07.00.

Coming up today: 

• Today we have a number of early European economic items, starting with German retail sales at 07.00. This is followed by Spanish Flash CPI at 08.00 and Flash GDP at the same time. European M3 money supply follows at 09.00. The main ticket is European CPI flash estimate at 10.00.
• From 13.30, we switch to North America for Canadian and US GDP data. US GDP is expected to advance 0.8%.
• Following this we have Chicago PMI at 14.45 and revised UoM consumer sentiment at 15.00.

Trade Idea: 

• Of all the yen pairs, the GBP/JPY has seen the most steady decline and then the smoothest advanced.
• This implies we could see further upside from here.

• A good way to play this is a HIGHER trade predicting that the GBP/JPY will close above 176.00 in 14 days for a potential return of 171%.

Powered by: Binary.com