JPY: Japanese Yen has gone over to the attack

At the Forex currency market the Japanese Yen rate is rising in price on Tuesday morning; investors’ demand for “quiet harbour’ is increasing in proportion to the deterioration of the external background, which causes strengthening of the JPY.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY, and is moving along the signal line now, not giving a clear signal. Stochastic Oscillator has come out of the oversold zone and is giving a buy signal, going upward.

Forex recommendations: in case of breakdown at the level of 76.40, the pair will go to 76.20 and 76.00. If downward breakdown does not take place, the pair will consolidate at the current levels.

According to the released information, Finance Ministry of Japan is going to address to the “Big Twenty” with the question of how exactly the countries are planning to resolve European debt problems and raise the issue of negative pressure of the expensive Yen on the economy of Japan. This can weaken the JPY for some time; however significant rollback can only take place if regulator will interfere with the market.It became known earlier that revised industrial output in July rose by 0.4% m/m against preliminary value of +0.6% m/m, which is logical since the decline which is being observed in all sections was caused by the slowdown of the world economy.

Statistics released earlier showed that real revised GDP in Japan fell by 0.5% q/q (-2.1% y/y) in Q2 against the forecast of -0.5% q/q (-2.0% y/y) and previous level of -0.3% q/q. Statistics released yesterday showed that bank lending fell by 0.5% in August against the decline of 0.6% in July.

In addition, index of economical observers who monitor current situation fell to 47.3 points in August against the level of 52.6 points in July. There are no risks for the Yen at the moment if only Central Bank of the country would not start another currency intervention.