USD Awaits Jackson Hole Symposium + USDJPY Short

In today’s live trading session, we went over our predictions for the Jackson Hole Symposium. We then found a sell setup for USDJPY.

Tomorrow is the Jackson Hole Symposium which is an annual event sponsored by the Federal Reserve where members discuss major economic issues. The biggest issue facing the global economy is the ongoing Covid-19 pandemic. Goldman Sachs believes Powell will describe his framework for the monetary policy as the United States battles the pandemic. This event is known for its above-average effect on volatility, so be wary of this while trading tomorrow.

Without too much knowledge of what Powell’s tone would be tomorrow, we turn to technical analysis to determine our bias. The US Dollar has kept its downtrend intact on the higher timeframes, but the lower timeframes suggest a possible breakout to the upside. Traditionally, we like to stick with the broader trend at hand, and that is one of the reasons why we are shorting USDJPY. We believe USDJPY is set to drop lower ahead of tomorrow’s event and it coincides with our analysis for the DXY.

Starting tomorrow during the New York session, the markets will be very active with unemployment claims data being released followed by Powell’s speech. We highly advise traders to manage their risk exposure during that time. As always, be safe and trade responsibly!