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Forex pairs in this Article » USD/JPY
By: DailyForex.com

The USD/JPY pair tried to rally during the session on Friday, but as you can see failed right around the 103.80 level. The pullback formed a bit of the shooting star, but I don't see this is a market that you can sell. All you have to do is take a look at the nice uptrend that we've been in for some time, to know that the markets are simply too strong to be selling in general.

Having said that, I can see several support areas just below, and as a result we simply cannot be selling this market. It's a good way to lose money, and as a result I am advocating being very patient with this market, as I am in a "buy only mode." As this market pulls back, I will look for supportive action in order to go long yet again, and I do believe that we are in the beginning of a multiyear uptrend.

A battle of two central banks.

This pair is a battle of two central banks. On one side of the Pacific, you have the Federal Reserve, which is looking to taper off of quantitative easing sometime over the next several months. The jobs number of course will have a great influence on whether or not they can do it, but the bond buyback purchase program appears to be getting ready to wind down a little bit. On the other side of the Pacific, you have the Bank of Japan. They are just now starting to make an extraordinarily weak and easy monetary policy, and because of that, the value of the Yen should continue to depreciate as long as we have no extremely bad headlines out United States.

That being said, I fully expect see this market go to the 105 level in relatively short order, and then perhaps the 110 level after that. Pullbacks will be buying opportunities, as I can see plenty of support at the 102 level, the 101 level, and without a doubt the 100 level. This market is one that will make a lot of careers for professional traders if they can be patient enough to hang onto the long position.

USDJPY Daily 121613

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