The US dollar has initially tried to rally during the trading session on Tuesday but found resistance again as we gave up early gains. The ¥109.50 level continues to be an area that a lot of people will be paying close attention to, as it has offered resistance a couple of times now. If we can break above the high of the Monday session, that opens up the possibility of a move to the ¥110 level, but quite frankly we need to see some momentum come back into the market. As things stand now, it certainly looks as if the market is going to continue to see a lot of volatility but at the end of the day as things stand right now it is starting to look like we are making a “lower high.”
USD/JPY Video 05.05.21
I am not ready to call this a reversal again, but if we get some type of impulsive candlestick, that will sell me the idea of going one direction or the other. I believe at this point we are simply sitting around this area trying to figure out where the next move is, and it should show itself rather soon. At this point in time, the market is likely to see a bit of grinding back and forth in order to figure out where we are going longer term. In the short term, it is probably best to simply observe this market as it is obviously at some type of inflection point. At this juncture, I am simply observing but I do believe that we should have a much clearer signal towards the end of the week as we get the jobs figure.
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