The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
Following on from my potential idea on Monday, this trade has now been triggered and is currently slightly ahead heading into Asian trade. Some positive US data overnight helped the US dollar remain bid and in turn underpinned USD/JPY.
Durable goods orders, consumer confidence and the Richmond manufacturing index all showed strong signs of growth. This was the biggest ever jump in durable goods. Don’t forget though, the surge in durable goods was a bit skewed as it was driven by a spike in orders for commercial aircraft. With the Boeing 787 enjoying significant interest, this is hardly a surprise.
The Case Shiller index also showed the US economy is enjoying a steady recovery. Additionally, geopolitical risk was somewhat downgraded and played into the hands of USD/JPY.
Friday will be the key for this trade as a raft of economic releases are due out of Japan. For now though, I’m happy to place stops at 15,350 with an initial target at 15,788.