US dollar falls against Japanese yen only to recover

The US dollar has fallen significantly against the Japanese yen during the week, reaching down to the ¥108 level. That’s an area that is somewhat important, as you can see over the past we have formed a bit of a barrier down to the ¥107.50 level, which has been massive in its implications. By forming a hammer, it suggests that we are ready to go higher, I think that clearing the ¥110 level opens the door to the ¥111 level after that. Beyond there, then we go to the ¥112.50 level, followed by the ¥114 level.

I have no interest in shorting this market, I think that the uptrend line has held, and now that we have pulled back slightly to form a strong supporter candle, it’s likely that we will continue to find reasons to go higher. It looks as if most of the currency market is suggesting that we are about to see a “risk on” move around the world, and I think that the USD/JPY pair will be any different. However, there are a few things you should be aware of, and be paying attention to see whether we can continue to try to rally. For example, the North Korea situation needs to go well, which so far it seems to be doing okay. Pay attention to interest rates in America, they continue to rally, it’s likely that we will continue to go higher based upon interest rate differential. There are also concerns about trade wars, but if we can avoid anything major, we should continue to go higher.