The US dollar rallied again on Thursday, showing signs of impulsivity after the announcement that the Americans and the Chinese were going to sit down and talk again. This of course is a very important development, and it will certainly have an effect on a market that is so highly sensitive to the Asian trade situation. If we can continue to get good news, that should send this market to the upside. Otherwise, I think we will probably turn around and reach towards the ¥111.10 level again, which extends support down to the ¥111 level.
This market has a major downtrend line just above, and if we can break above that area, at roughly the ¥112.25 level, the market can go much higher. It doesn’t mean that it’s going to, nor does it mean that it’s going to be easy to do. However, we have a very obvious signal above, and it certainly looks as if the buyers are becoming more aggressive. At this point, I look at pullbacks as a buying opportunity, and I will continue to look at the market as such. If we did break down below the ¥111 level, then I think there is a lot of support underneath at the ¥110.50 level. Expect volatility but be patient and wait for those buying opportunities overall, as it seems to be the way the market wants to go longer-term. Once we finally do get the break out, it could be a “buy-and-hold” scenario.
USD/JPY Video 14.09.18
This article was originally posted on FX Empire
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