The US dollar has gone back and forth during the course of the trading session on Monday, as we have seen a significant amount of volatility. The ¥115 region has been tested, but it does look as if it is holding. Because of this, it is very likely that we continue to see buyers given enough time, due to the fact that the ¥115 level was so important. Furthermore, the 50 day EMA is starting to rise higher and towards the price itself, so it will be interesting to see if technical traders pay attention to that as well.
USD/JPY Video 11.01.22
To the upside, the market is very likely to see the ¥116.35 level as slight resistance, but all things being equal it is likely that we will continue to see more upward pressure than down, mainly due to the fact that the Federal Reserve is expected to tighten monetary policy, which of course should continue to strengthen the greenback. The pair has been in a strong uptrend for quite some time, so it does make quite a bit of sense that we will eventually follow-through.
I have no interest in shorting this market, because quite frankly it is so strong that it almost has to continue going higher unless of course the Federal Reserve decides to suddenly change course. If it does, then obviously it would be “anything goes” in this marketplace, but right now this is clearly a market that continues to see a lot of buyers on dips and I am going to go ahead and continue to trade this market looking for value.
For a look at all of today’s economic events, check out our economic calendar.