Dollar Crashes versus Yen; Trade Apple Stock Today
USDJPY Buyers to Return? | Rising Trend Line Holding
USDJPY might be ready to resume its climb, even after the pair suffered a sharp selloff in recent trading. Price was unable to recover so far this week, even as the Japanese economy reported a steeper contraction while the US printed a stronger than expected jobs reading for November.
Profit-taking took a hit on this pair, along with the pickup in risk aversion due to the political tension in Greece. This weighed in favor of the lower-yielding Japanese yen as traders took the flight to safety and dumped higher-yielding assets. US equities also suffered a sharp selloff, which led to dollar weakness.
For today, the upcoming US retail sales could change all this if the actual results come in stronger than expected. Analysts are pricing in strong gains since the Thanksgiving holiday sales might’ve resulted to stronger spending, along with the strong surge in hiring for November.
With that, USDJPY could resume its climb back to the 120.00 major psychological mark or higher until the 122.00 area near its previous highs. On the other hand, bleak data could worsen the selloff and lead to a test of the recent spike lower at 188.00.
USDCAD Countertrend Setup | Channel Resistance at 1.1500
USDCAD might be forming a potential countertrend setup on its 4-hour chart, as the pair is testing the top of the rising channel. Shorting at the 1.1500 major psychological resistance at the top of the channel and aiming for the bottom at the 1.1250 minor psychological support could yield a good return-on-risk with a tight stop.
Stochastic is moving up though, indicating that buyers might push for an upside break of channel resistance. A strong candle close above the 1.1500 resistance level might confirm that the trend has strengthened and that further gains are in the cards.
Much could depend on the outcome of the US retail sales reports due in the New York trading session. Thanks to the pickup in spending during the Thanksgiving holidays, analysts are expecting higher retail sales figures for November. Apart from that, the jobs market was also in better condition then, as the NFP reading for the same month showed an upside surprise.
With that, the path of least resistance is to the upside, although many have already priced in their expectations for the event. This opens up the chance for a downside surprise, which might potentially lead to a stronger reaction from this USDCAD pair.
Apple Shares Ready to Test Support | Pullback to 50 SMA
Apple shares still seem to be in the middle of a market correction, as price recently pulled back after nearing $120/share. This led to a move towards the 50 simple moving average, which has held as a dynamic support area in the past.
Another test of this floor might take place right around the $107.50/share level, which is also the 50% Fibonacci retracement level based on the swing low and high on the daily time frame. A deeper pullback might last until the $100/share level, which happens to be an area of interest.
Risk aversion is weighing on U.S. equities and other high-yielding assets for the time being, as traders are currently wary about the ongoing political tension in Greece. A vote in three rounds will be held to keep the current government in place, otherwise the parliament will be dissolved and spark more uncertainty for the country.
If the latter takes place, Apple shares might be in for more losses and take some time before resuming its climb. MACD is reflecting a pickup in selling pressure, which suggests that traders might not be too keen to buy on the dips just yet. RSI is also heading south, although it is almost in the oversold area and might reflect a return in buying pressure soon.