August 23, 2018 08:31: Dollar/Yen Trade Strategy [From Mr. Satoshi Emori’s e-newsletter]
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From the investment newsletter "Chisato Emori's Real Trading Strategy" by Tetsuya Emori provided by GogoJungle, here is a small excerpt from this morning's dispatch. This time, please look at the trading strategy of the USD/JPY where position adjustments focused on selling yen and buying dollars pushed the pair into the mid-110s.
We will unwind the short position on USD/JPY and go long. It has been firmer than expected, and our view appears to have been incorrect. The shorts also served as a hedge against Japanese stocks, so I think that was fine in that sense. By maintaining the important support at 110.20 yen, the short-term outlook has tended to improve. There is room for further upside, so in the near term I would like to anticipate a rebound. After that, I want to watch whether we can break through 111 yen. If we exceed this level, the momentum for further gains is likely to pick up. External factors remain a significant concern, but in response to them, dollar-selling adjustments have been favored. As a result, the dollar has weakened while cross-yen pairs have been bought, ultimately leading to a yen depreciation. For USD/JPY, there is still underlying dollar strength, so it can be argued that dollar strength and yen weakness are occurring. That said, the basic policy remains dollar weakness. It is always important to keep in mind the potential for USD/JPY to fall.
From “Chisato Emori's Real Trading Strategy” (Tetsuya Emori) quoted.
On the 24th, Fed Chair Jerome Powell is scheduled to speak at the Economic and Financial Symposium (Jackson Hole Conference). All eyes will be on how the market moves in response to this heavyweight's remarks. (Editorial Department)
USD/JPY, 1-hour chart.
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