The US dollar has pulled back from the 50 day EMA against the Japanese yen, now looking as if it is going to go looking towards the ¥107 level. That is an area that will attract some attention but as we have broken through it previously, it is very likely that we will simply continue to chop in this area and try to wipe out as many accounts as possible, which is basically what this pair is designed to do at times it feels.
USD/JPY Video 13.05.20
That being said, the market is most decidedly in a downtrend, and this of course has not changed. It is somewhat sensitive to risk appetite but there are a multitude of things going on at this point in time, so one should pay attention to the US dollar in and of itself. It has been gaining against most currencies, with the exception of the Japanese yen as it considers itself to be the “safest currency.” Ultimately, I believe that the market is still looking to chop its way down towards the ¥105 level, but it could take weeks to get there as the market simply grinds back and forth without any real clarity from a day-to-day basis most of the time. This is a great proxy for the S&P 500, which has been very choppy and difficult to deal with as of late. Eventually, everything will break in the same direction, but until then expect it to be very rough sledding.