The US dollar has pulled back ever so slightly during the trading session on Wednesday but as you can see there is support underneath that could come into play rather quickly, in the form of the ¥109 level. Furthermore, we also have the uptrend line from the channel that we have been in for a while, and then of course the 50 day EMA after that. With all that being said, it is very likely that there should be buyers jumping in to push this even higher. However, keep in mind that the market is highly sensitive to the risk appetite in general, as the pair does tend to move higher and lower right along with it.
USD/JPY Video 10.06.21
If we break down below the 50 day EMA, then it is likely that we could go down to the ¥108 level, which is where the 30.2% Fibonacci retracement level sits and of course the bounce that recently happened. By the time we get down there, it is very likely that we could see the 200 day EMA come into the picture as well, so I believe in the short term that is essentially the “major floor” in the market.
To the upside, the ¥111 level is a ceiling that people should be paying close attention to and therefore it should be a bit of a target. That being said, it is not very likely that this is an easy move and therefore it is likely that we would see a lot of choppy behavior but with an upward tilt more than anything else.
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