Weekly Currency Review: Yen Flash Crash Affects Currencies

January 8, 2019

Japanese Yen Crash

A Flash Crash happened on Thursday opening when the yen surged through levels that haven’t been broken for about 2 years.

Traders across Asia and Europe are looking for the reason why it happened in those minutes when orders flooded in to sell. It jumped about 8 percent versus Australian Dollar and 4,5 percent against Great Britain Pound. I Know First Forecast has successfully predicted both pairs for long with the return of 3.33% on GBP/JPY and AUD/JPY 4.18% and for short JPY/CNY with the return of 2.21%. Some noted that this fall was triggered by Apple Inc. cutting its sales forecast, others claim that Japanese investors executed loss positions. The main fall was triggered by algorithmic programs and lack of liquidity with Japan on holiday.

[Source: thinkorswim terminal]

[Source: thinkorswim terminal]

EUR/AUD

I Know First Forecast for one week from December 26, 2018, to January 3, 2019, generated a 1.26% return on EUR/AUD.

The Japanese Yen was not the only affected by the Flash Crash. EUR/AUD has also been affected and has recently created an interesting setup on a weekly basis. After a Flash Crash, we saw a spike, which stung 1.6270 resistance level and then turned back, which indicates possible price downtrend to the support levels of 1.3774.

[Source: thinkorswim terminal]

CHF/GBP

Factories can not show the proper growth to remove the shade of Brexit negotiations. British factories are trying to increase their stockpiling in December since they want to prepare for border delays when in less than 3 months Britain leaves the European Union, a survey showed.

“Despite this increase in demand, confidence remains weak as everyone knows that these increased supplies of raw materials, constituent parts, and finished goods will eventually run out and supply chain disruption will hurt businesses later down the line,” said Jeremy Thomson-Cook, chief economist at WorldFirst.

I Know First has successfully predicted this situation with a bullish forecast on CHF/GBP and 0.94% gains from December 26, 2018, to January 3, 2019.

The CHF/GBP is an interesting pair because it is combined with risk currency such as the Pound with safe currency – Franc.

On the daily basis, for now, we could observe a Bullish flag during recovery from December 10 lows, which is usually a harbinger of an upcoming upside trend. A break of the flag will signalize a bullish confirmation and we can expect these levels to go to October lows at 1.2750.

[Source: thinkorswim terminal]

On the chart below, you can see I Know First Forecast from December 27, 2018, to January 3, 2019. It includes long and short recommendations. Currency Predictions

How to interpret this diagram

Algorithmic traders utilize these daily forecasts by the I Know First market prediction system as a tool to enhance portfolio performance, verify their own analysis and act on market opportunities faster. This forecast was sent to the current I Know First subscribers.

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Algorithmic traders utilize these daily forecasts by the I Know First market prediction system as a tool to enhance portfolio performance, verify their own analysis and act on market opportunities faster.

Please note-for trading decisions use the most recent forecast.

Currency Review

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