The US dollar has rallied a bit during the course of the trading session on Wednesday as the market is awaiting the comments coming out of Jerome Powell. All things been equal, the market is likely to see the ¥111 level above has offered significant resistance more than once, so it will be interesting to see how it plays out this time. The market continues to see a lot of noise in that area, but if we were to break through the ¥111 level, it is possible that we could go looking towards the ¥112 level, but what this tells me is that there is a lot of resistance just above that could come into play.
USD/JPY Video 23.06.21
In other words, if we were to continue going higher, it might be easier to short the Japanese yen against other currencies instead of the greenback. This is not to say that you cannot trade this market, just that the momentum that you pick up will probably be somewhat limited. To the downside, if we were to break down below the hammer from the Monday session, that could send this market lower, perhaps reaching all the way down to the 38.2% Fibonacci retracement level. The 200 day EMA sits there, so that of course would make a certain amount of sense as well. Keep in mind that this pair is somewhat sensitive to risk appetite and of course with Jerome Powell speaking in front of Congress, he could throw a bit dollar around as well. By looking at the monthly chart, you can see just how much resistance there is just above.
For a look at all of today’s economic events, check out our economic calendar.