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Trades for the Japanese Yen rate maintain almost unchanged at the Forex currency market in the middle of the week. On the one hand, interest in safe currency is low now, on the other hand, the Bank of Japan has not confirmed its plans to conduct new round of currency intervention.

Forex forecast: MACD indicator for the pair USD/JPY is growing in the positive area and is giving a buy signal. Oscillator is moving along the signal line in the neutral zone and is not giving a clear signal.

Forex recommendations: in case of breakdown at the level of 77.70, the pair will go to 77.50 and 77.30. If downward 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 rose by 1.3 points in October. The Yen ignored this data, as well as the news that preliminary leading indicators index remained unchanged.

The head of the Bank of Japan Mr. Shirakawa noted earlier that growth of the JPY continues to negatively impact on the local economy and that current rise of the JPY was provoked by European crisis. He believes that if appropriate measures are not taken straight away, economy of Japan will decline sharply by 2030. Mr. Shirakawa also noted that interventions against Yen are acceptable and effective.

However, practical actions to support the words have not been made: apparently the Japanese regulator is in the “fly-through mode” presently moreover, the Yen does not give grounds for intervention due to its moderate activity.

Statistics of the last week showed that orders in the construction sector of Japan amounted to+24.3% y/y in October. In addition, preliminary industrial output rose by 2.4% m/m (+0.4% y/y) in October against the forecast of +1.1% m/m. nevertheless not everything is so positive: PMI in the manufacturing industry declined to 49.1 points in November, as per Markit/JMMA estimates, against the level of 50.6 points in October. It became known earlier that unemployment rate in Japan increased to 4.5% in October against the level of 4.1% in September, while expectations were at 4.2%. The rate is increasing for the first time in three months, which is an indication of a new round of slowdown in Japanese economy. Large funds have been invested into Japanese economy following the earthquake in March, which explains fairly rapid recovery; however the rate of recovery started to decelerate lately. It should be closely tracked to what extent European economic slump would affect Japanese economy.

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