What Is Going On With JPY?

I have been using the calendar to trade. It is a big improvement over using indicators. Wow! I am using IR releases to some success. However, I took a heavy loss trading the USDJPY. The IR is way higher in USD, so I decided to place a USDJPY trade. This was a mistake(trade placed on the 6th of July). What the heck happened? It reversed. Should the next USD IR show some promise? I believe this was a problem because I did not “strike when it was hot”, but how the heck could it reverse its movement? How did it reverse when the IRs are very distant?

Also, why is this loss across the board(NZDJPY, CADJPY, GBPJPY)

There are more fundamental factors than interest rates for the two currencies in the pair which affect exchange rate prices. Much price action is in anticipation of these, rather than awaiting the announcements. In any case, price is also influenced by speculation on the price itself: which is maybe why major pairs rarely move more than 3 consecutive days in the same direction.

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At the end of June JPY started to reach strong support as USDJPY buyers were getting cold feet approaching levels where BOJ intervened strongly in October & November of 2022. Other JPY pairs were also reaching a ceiling. More and more long positions got closed (= buying back JPY) as the market anticipated that later this month BOJ might change its long term policy on yield curve control (that looks more & more likely). Last wednesday’s US inflation figures pushed that momentum further with a big selling spree on USD. Anyway FWIW that’s my version of what happened, sorry you got in on what could have looked like a temporary pullback :grimacing: hindsight hey!


This. It’s so complicated keeping up with everything going on and what could be contributing to their moves. Probably why most just stick to TA.