The Japan Economic Watchers Index is out. And guess what, the report shows a 3.6 increase in businesses that directly serve the people of Japan.
What does that mean for the Japanese currency? More in a minute.
What the Japan Economic Watchers Index is All About and Why You Should Care!
The economy watchers current index is an important economic event in the Japanese calendar used to measure the mood of businesses that directly serve consumers.
Some of these businesses include salons, taxi barbershops, and more.
Previously, in May, the reading was 5.0 which was a significant increase from 47.8 in April.
The report released today shows an even higher reading at 54.0 which is the highest seen in the report since January 2022.
If you are a day trader in Forex, you should care about this report because it might affect the price of the Japanese Yen, and your favorite JPY pairs.
How the Economy Watchers’ Current Index could affect the GBP/JPY today from a technical perspective.
A quick glance at the GBP/JPY pair shows a stronger GBP against the JPY since 12th May.
Use an arc from the highest recent price, 19th April, and drag across to 10th June, the day after tomorrow.
The visual effect you get is that of a cup.
A cup and handle is a technical chart pattern that resembles a cup and handle. The cup in this case is in the shape of a “u” and the handle has a slight downward drift. After the downward drift, price may continue upwards.
If you’ve ever traded the cup and handle pattern then it should not take a spell to realize that after a slight correction in price, the GBP/JPY may be more bullish.
From where I sit, there is a great chance that the GBP/JPY may reach the 168.305 price point today.
Retrace as more traders speculate on a bullish JPY, (triggered by the japan Economy Watchers Current Index report) before moving back up with the volatility of the opening of the London session.
We may see a slight fall in the GBP/JPY pair for many hours today (forming the handle of our “cup and handle pattern”) and then a bullish continuation in the GBP/JPY pair.
But hey howdy, don’t take my word for it! Try doing your own analysis too. If you haven’t guessed already, my head is never right. I have wayward thoughts about where the currency pair should go all the time. And most of the time… Trade with XM Global.