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Japanese Yen Cross Pairs Provide Long-Term Trading Opportunities

ByBrian Twomey
Published 12/22/2021, 02:57 AM
Updated 09/03/2023, 03:41 AM

Long-term targets are defined as 500, 700, and 1000 pip trades. The view to long-term duration is about 3 to 4 months and depends on price movements when to factor again.

Last JPY cross pair target trades were completed in April/ May for 2000 ish pips and posted with updates In April, JPY cross pairs traveled lower with DXY when DXY achieved 93.00 highs and just prior to the 5 year average at 95.00's.

JPY cross pairs today settled into 200 pip ranges or 100 pips on either side of vital MA's. GBP/JPY is included as a JPY cross pair when correlations align to USD/JPY. In the past 3 weeks, GBP/JPY correlates to GBP/USD and is excluded from JPY consideration.

The 2 main drivers to JPY cross pairs are USD/JPY and oddly CHF/JPY as both target much lower prices at USD/JPY 110.18 and 116.87 for CHF/JPY. For CHF/JPY contains vital lines at 122.47 and 117.90 and must break to target 116.00's. Both USD/JPY and CHF/JPY are severely overbought.

CHF/JPY is a USD pair as it Correlates to USD/JPY at +99%, USD/CAD +84%, USD/CHF at +86% and negatively correlates to GBP/CHF at -91%.

USD/JPY mainline break to target 110.00's is located at 112.85. As 112.85 rises, longer-term averages become more overbought, which means USD/JPY's fall will hit much harder and faster. Extreme prices for USD/JPY are located at 115.00's and middle 114.00's.

CHF/JPY extremes begin at 125.00's. Both USD/JPY and CHF/JPY contain short-only strategies and match EUR/USD's long only.

Part explanation to JPY cross pair 200 pip ranges is due to USD/JPY’s loss of correlations to EUR/JPY at -83%, AUD/JPY -51%, NZD/JPY -30% and +28% to CAD/JPY. Only current trades available to JPY cross pairs are daily and weekly.

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Trading Opportunities In JPY Cross Pairs

EUR/JPY is supported below at 127.36, 127.04, and 126.33 Vs 129.21 and 129.32 above. A break at 129.32 begins a short-only strategy. Meanwhile, CAD/JPY is supported at 86.17, 85.80, and 85.00's across the board. Any price above 88.51 begins a short-only strategy.

AUD/JPY is supported below at 79.87 and 80.91 Vs 81.90 and 82.51. NZD/JPY is well supported below at 75.93, 75.54, 75.47, and 75.20. Any price above 76.88 begins a short-only strategy.

Best trades are EUR/JPY and AUD/JPY as both retain high places to weekly rankings for each of the past 2 weeks.

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