The US dollar has rallied a bit during the course of the trading session on Wednesday as the ¥109 level continues to offer significant support. The support level has been very reliable multiple times, and therefore you should also look at this as a potential return towards the ¥110 level. The ¥110 level has been a bit of a major magnet for price, and that of course is something that you need to keep in the back of your mind. All things being equal, this is a market that I think does in fact continue to show the same back-and-forth attitude that we have seen for some time.
USD/JPY Video 23.09.21
Looking at this chart, if we were to break down below the 200 day EMA underneath, that could open up massive selling pressure to the downside, perhaps reaching towards the ¥107.50 level. On the other hand, if we were to turn around a break above the ¥110.75 level, then the market goes looking towards the ¥111.50 level. With that being the case, the market continues to see a lot of noisy behavior, and therefore I think you need to be cautious with your position size, but if you are a short-term trader this might be a nice range bound market to be involved in.
There is a certain amount of risk appetite that goes into the thought process of this market, so keep that in mind as well. The Japanese yen being the ultimate safety currency is going to attract attention every time there is a certain amount of concern when it comes to financial markets around the world.
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