Dollar-Yen: Why Central Banks are the Wrong 'Point of Focus' (so what does matter?)
by Nico Isaac
Updated: May 03, 2023
Welcome to Chart of the Day. I'm Robert Folsom for Nico Isaac.
Dollar-Yen: Why Central Banks are the Wrong 'Point of Focus' (so what does matter?)
I recently returned to my (pre-pandemic) yoga class, only to learn that my balancing ability is now akin to that of a three-legged chair. My teacher, noticing this, reminded me of the Sanskrit word "Drishti," which means "point of focus."
Basically, (until you can master your inner vision) you rely on your outer vision. You focus on a fixed point in the room as you work on balancing postures. This draws your attention away from your wobbly legs and onto the Drishti, to keep yourself stable.
It reminds me of how "fundamental" analysis is supposed to work. Traders and investors fixate on events outside the financial markets in the hope that they can anticipate where prices are headed. As in, a commodity trader may focus on weather patterns that affect crop conditions, while a stock trader's Drishti may be on earnings for directional clues.
Currencies are no exception. Like on April 28, of the US Dollar/Japanese Yen traders were laser-focused on one single "fundamental" -- the effect of that day's Bank of Japan policy decisions.
But unlike a yoga Drishti, this point of focus was not "fixed." In fact it was all over the place, as these news items reveal.
Makes me dizzy just thinking about it ... which leads to a simple question: is there a different Drishti traders can focus on, which can help stabilize their market decisions?
Yes!
Let's return to the recent price action in the US Dollar/Japanese Yen. On April 27, our Currency Pro Service showed a version of this chart of USDJPY. There, we identified that the trend was early in a powerful third wave rally.
And this is what followed: On April 28, the pair shot up to its highest level in 6 weeks.
When it comes to trading, the goal is not top-and-bottom pick based on news. It's to have a balanced focus on what matters -- high-confidence set-ups. Of course, trading is risky and not all Elliott wave interpretations correctly anticipate price direction.
Currency Pro Service does present labeled price charts, video analysis, and forecasts of where the world's leading forex pairs may go in the hours, days, and weeks ahead. And, every outlook includes critical price levels to help manage risk.
See below to regain your trading balance.
Timely. Insightful. Hard to Get Elsewhere.
(not what everyone already sees)
The Dollar-Yen chart (and forecast) speaks for itself. Our subscribers were READY for this major currency pair to move rapidly upward.
What's more: The forecast you just saw in action would only come from EWI. Yes, that sounds like a big claim. Even so, you can be ready for the next major move. For information about Currency Pro Service, please see the information below.
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