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At the Forex currency market the Japanese Yen rate on Monday; the currency is definitely waiting for new signals.

Forex forecast: MACD indicator for the pair USD/JPY has broken through the signal line from bottom to top and is traded in the positive area; however a buy signal is very weak. Oscillator is moving sideways in the neutral zone and is not giving a clear signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 78.20, the pair will go to 78.30 and 78.50. If upward breakdown does not take place, the pair will consolidate at the current levels.

It became known today that preliminary index of coincident indicators in Japan fell by 1.4% m/m in September against the decline of 0.1% m/m last month. It is a negative signal for the Japanese economy, indicating sluggish rate of economic growth if there is any growth at all.

According to statistics released last week, number of begun housing construction in Japan fell by 10.8% y/y in September against the forecast of growth by 7.6% y/y. In addition, orders in construction sector of Japan declined by 9.3% y/y in September against the growth of 9.3% y/y in August.

According to the minutes of the meeting of the Bank of Japan of 6-7 October, which were released earlier, some members of the regulator are convinced that downside risks are increasing and it is important for the Central Bank to take prompt actions. One of the members of the Central Bank suggested that additional stimulation of the credit policy can be required.

We would remind that the Bank of Japan has conducted currency intervention on Monday morning in order to relieve the pressure of JPY on the national economy. Mr. Adzumi, Finance Minister of Japan, confirmed the fact of infusion into the currency market, which became especially important when the Yen had reached historical highs in pairing with the USD last week. Therefore, Central Bank of Japan has ventured to carry out the third currency intervention since the beginning of the year, which resulted in decline of the Yen by 5%.

Last week, the Bank of Japan left interest rate in the previous range of 0-0.1% per annum, as expected; at the same time, asset purchase program was increased up to Y50 trillion from Y55 trillion. In the follow-up comments Japanese regulator stressed that risks to economy shall be thoroughly considered as well as downside risks to price forecasts in the future. According to the estimates of the Bank of Japan, exchange rate of the Yen will remain high for a while; the Bank has not clarified whether currency intervention threatens the JPY or not.

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