The Federal Reserve is continuing to print money | 26 July 2021

26 July 2021, USD/JPY

The Federal Reserve is continuing to print money

USDJPY trading plan:

The Federal Reserve is continuing to print money and increasing the dollar liquidity surplus. Bankers now have a lot of capital; they don't know what to do with it. Against this background, bankers are involved in reverse repo transactions with the Fed. Such operations are carried out only during periods of excess liquidity. If at the beginning of the year the volumes in such operations were at the level of $100 billion per day, then in July it rose to $900 billion. The media and economists whip up panic and say that the Fed is going to recall liquidity, and the bankers have an excess of this liquidity. This is a good signal for the stock market and USDJPY, which has a correlation with the shares.

Investment idea: buy 110.00 and take profit 110.50.

David Johnson
Analyst of «FreshForex» company
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