Forex analytics of LiteForex of 26.10.2010: JPY: Japanese Yen continues to grow and approaches the maxima again

On Tuesday in the currency market (forex) JPY continues to rise and although the purchases of the currency are not large scaled as before JPY continues to approach new historical maxima.

Forex (forex) Forecast: MACD indicator is in the negative area for the pair USD / JPY and it is decreasing thus giving a signal to sell the pair. The signal of stochastic oscillator is the same on Tuesday.

Forex (forex) recommendations: if the level of 80.35 is broken the pair will go to 80.10 and 79.75 which will become a new historical minimum of the pair USD / JPY.

Japanese Finance Minister Noda in the morning continues to charge the market with his confidence that the economy of the country is all right: today he has said that Japan will seek the cooperation with European countries and the United States only if the fluctuations in the currency market are too harsh.

In his opinion so far Japan is interested in the resistance to further USD weakness and thereby to the increase of JPY.

Today a representative of The Japan Iron and Steel Federation Mr. Hayashida has noted that the optimal rate of the yen is now at the level of 90.0.

According to the text of monthly report of Japanese authorities released earlier the economic situation of Japan is deteriorating - the last time similar assessment was voiced in the summer of 2008. In addition the first time in 2 months the production forecast estimate is reduced - weak global economy does not contribute to the demand for high-tech products produced by Japan.
As it is noted in the report the unemployment situation remains difficult. Levels of unemployment are high and the prospects so far are uncertain. The main factor of downside risks for corporate profits is low levels of exports and industrial production. The increase of JPY exerts a negative impact on economic sentiments.

The statistics of Japan released on Monday morning is fairly positive (the level of trade balance rose by 54.0% per annum in September up to Y797, 01 billion; the level of exports rose by 14.4% y/y in September which is the tenth month of growth in a row; the level of imports in Japan increased by 9,9% y / y in September which is a continuation of the indicator growing trend the ninth month in a row).