The Friday candlestick suggests that we are not quite ready to take off yet, but that makes sense. I would actually prefer to see this market go sideways, mainly due to the fact that it shows more time being spent at this price. Recognizing them, the market accepts this price. If we can recapture the 155 yen level, then I think we could see the market much higher, perhaps racing towards the 50 day EMA, which is at the 157.50 yen level. Breaking above that level then opens up the possibility of a move all the way to the 160 yen level, which I think is very realistic. We do have a major interest rate differential between the US dollar and the Japanese yen. And as a result, I think you’ve got a scenario where you get paid at the end of every session and it does make sense to be involved.
If We Fail at Here…That being said, if we were to turn around and break down below the 152 yen level, then we may have to look at the 150 yen level as potential support. Anything below there could be a significantly negative bias to really have people shorting this pair. But right now, the Bank of Japan is essentially stuck with its ultra-loose monetary policy while the Federal Reserve is still somewhat in the air as to how many cuts they are going to make in the next few months if any at all.More By This Author:Pairs In Focus – Sunday, July 28CAD/CHF Forecast: Will 0.63 Hold?USD/CAD Forecast: Extends Into Resistance
