The US dollar has rallied a bit from the ¥105 level, as the area continues to be very stubborn. Quite frankly, if we break down from here it is likely that we will go much lower and therefore I think it is most certainly worth paying attention to right now as this is a market that continues to grind it. It is worth noting that the 50 day EMA has turned lower and it is likely that will attract a lot of technical traders, assuming that we get a bounce from here. I would be looking to fade rallies more than anything else but if we can get a daily close below the lows of the Wednesday candlestick, that would also be a very negative sign and could send more money to the downside.
USD/JPY Video 31.07.20
The US dollar is suffering at the hands of the Federal Reserve, which continues to stuff the financial markets with liquidity. In other words, they are throwing dollars at anything that moves. If that is going to be the case, eventually all currencies will rise against the greenback, including the Japanese yen. If we break down below the ¥105 level significantly, then we are going to go looking towards the ¥102 level, perhaps even followed by the ¥100 level, an area that typically will get some type of reaction out of the Bank of Japan, be it verbal or actual intervention. We have a while to worry about that though, so I think you continue to favor the downside here, but it looks as if we may be trying to bounce just a bit.
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