Technical Analyses
So my reasoning for a Long Position on the CAD/JPY, like all good positions started off with bigger picture thinking.
There is often a Chinese proverb I think of before I make my trade, that goes "to know what is inside, you must know what is outside" - Chinese proverb.
Starting with the weekly Dollar Yen chart, I originally saw an opportunity using my linear regression channels, based on a 50,100, and 200 period. Combined with the SMA200 which we sit above on the weekly and monthly chart.
Price Action has indeed touched the lower of the LR200 Channel of the weekly chart, while the LR200 still remains in an uptrend.
The weekly chart has given me my long term position strategy. Going into Q4.
Fundamental Analyses
I quite enjoyed the recent meeting minutes from the Bank of Canada, on there monetary policy report released July 2015. I am going to quote some of the recent meeting minutes to help you.
As per meeting minutes, Page Thirteen, Paragraph 4;
"The Bank expects real GDP growth to resume in the third quarter. While business investment in the energy sector will likely contract further, growth will be supported by a partial recovery in exports and by federal fiscal stimulus, which should boost consumption. Starting in the fourth quarter, real GDP growth is expected to exceed potential as the drag from the resource sector dissipates and the recover in the non-resource sector strengthens. On an average annual basis, real GDP is projected to grow by just over 1 per cent in 2015 and about 2 1//2 per cent in 2016 and 2017'.
To quote as per Page 22 of the Monetary Policy Report 5th paragraph;
"Several factors point to a resumption of growth in the third quarter and further strengthening later on. The bank anticipates that the non-resource track for growth will begin to dominate in the third quarter and that the economy will expand by roughly 1 1/2 per cent. Consumption is expected to accelerate as household disposable income receives a boost from retroactive federal payments to families with children. Importantly, exports are projected to return to solid growth, supported by continued improvements in the U.S. demand and a rebound in automotive exports following temporary shutdowns for retooling at the beginning of the year. Business investment will remain a source of drag, however, as the energy sector continues to adjust to low oil prices'.
-Economy is expected to expand by 1 1/2 per cent third quarter.
-Real GDP growth expected to resume in third quarter with further strengthening.
-Consumer Confidence remains high, save the pullback from oil producing provinces.
-Non-resource sector employment has showed continued growth.
-Manufacturing activity picking up.
-Foreign demand improving.
-Interest Rate at %0.50
The Bank of Canada also expects inflation to return to %2 in the first half of 2017.
Now we take some time to view the Bank of Japans Meeting Minutes released on July 21st.
I will keep this short and sweet.
-In the money market, interest rates on both overnight and term instruments
continued to be at low levels.
-Inflation levels rising as a result of qualitative and qualitative monetary easing (QQM) (Higher inflation means downward pressure on currency value)
-Interest Rate at 0.10%
-The Bank will continue with (QQE)
My position is long, looking for healthy Canadian Q3 GDP reports and economic expansion as the economic contraction in the oil industry becomes less of a drag on overall economic indicators. Japan is still increasing inflation rates as Canada is waiting for 2016-2017. Furthermore does Canada hold a higher interest rate at 0.5% compared to Japan at 0.10%. I will be looking to take profit from this position going into 2016.
If you liked my report, please do not forget to click like at the bottom and post a comment.
-DonaldDuck
So my reasoning for a Long Position on the CAD/JPY, like all good positions started off with bigger picture thinking.
There is often a Chinese proverb I think of before I make my trade, that goes "to know what is inside, you must know what is outside" - Chinese proverb.
Starting with the weekly Dollar Yen chart, I originally saw an opportunity using my linear regression channels, based on a 50,100, and 200 period. Combined with the SMA200 which we sit above on the weekly and monthly chart.
Price Action has indeed touched the lower of the LR200 Channel of the weekly chart, while the LR200 still remains in an uptrend.
The weekly chart has given me my long term position strategy. Going into Q4.
Fundamental Analyses
I quite enjoyed the recent meeting minutes from the Bank of Canada, on there monetary policy report released July 2015. I am going to quote some of the recent meeting minutes to help you.
As per meeting minutes, Page Thirteen, Paragraph 4;
"The Bank expects real GDP growth to resume in the third quarter. While business investment in the energy sector will likely contract further, growth will be supported by a partial recovery in exports and by federal fiscal stimulus, which should boost consumption. Starting in the fourth quarter, real GDP growth is expected to exceed potential as the drag from the resource sector dissipates and the recover in the non-resource sector strengthens. On an average annual basis, real GDP is projected to grow by just over 1 per cent in 2015 and about 2 1//2 per cent in 2016 and 2017'.
To quote as per Page 22 of the Monetary Policy Report 5th paragraph;
"Several factors point to a resumption of growth in the third quarter and further strengthening later on. The bank anticipates that the non-resource track for growth will begin to dominate in the third quarter and that the economy will expand by roughly 1 1/2 per cent. Consumption is expected to accelerate as household disposable income receives a boost from retroactive federal payments to families with children. Importantly, exports are projected to return to solid growth, supported by continued improvements in the U.S. demand and a rebound in automotive exports following temporary shutdowns for retooling at the beginning of the year. Business investment will remain a source of drag, however, as the energy sector continues to adjust to low oil prices'.
-Economy is expected to expand by 1 1/2 per cent third quarter.
-Real GDP growth expected to resume in third quarter with further strengthening.
-Consumer Confidence remains high, save the pullback from oil producing provinces.
-Non-resource sector employment has showed continued growth.
-Manufacturing activity picking up.
-Foreign demand improving.
-Interest Rate at %0.50
The Bank of Canada also expects inflation to return to %2 in the first half of 2017.
Now we take some time to view the Bank of Japans Meeting Minutes released on July 21st.
I will keep this short and sweet.
-In the money market, interest rates on both overnight and term instruments
continued to be at low levels.
-Inflation levels rising as a result of qualitative and qualitative monetary easing (QQM) (Higher inflation means downward pressure on currency value)
-Interest Rate at 0.10%
-The Bank will continue with (QQE)
My position is long, looking for healthy Canadian Q3 GDP reports and economic expansion as the economic contraction in the oil industry becomes less of a drag on overall economic indicators. Japan is still increasing inflation rates as Canada is waiting for 2016-2017. Furthermore does Canada hold a higher interest rate at 0.5% compared to Japan at 0.10%. I will be looking to take profit from this position going into 2016.
If you liked my report, please do not forget to click like at the bottom and post a comment.
-DonaldDuck