The US dollar rallied significantly during the trading session on Tuesday, as we continue to see money flowed into the US dollar overall. However, this is a bit of a wrist sensitive currency pair, so keep in mind that the pair very often will move right along with the S&P 500 and other stock markets in America. As the stock markets have outperform so many others, it makes quite a bit of sense that we continue to see the US dollar strengthening.
USD/JPY Video 22.05.19
Beyond that, there are a lot of headlines out there that have the markets somewhat jittery to say the least. If that’s going to be the case, you should keep in mind that this won’t necessarily be a “one way shot”, at least not that easy. There is a gap above that I think is going to be filled at the ¥111.15 level, and I do believe that’s the destination. That doesn’t mean there will be the occasional pullback, because we know there’s more than enough out there to have the markets a bit nervous. However, the ¥110 level should now be thought of as a bit of the support barrier, and therefore as long as we can stay above there you’re probably going to be better off looking for short-term buying opportunities.
If we were to break down below the ¥110 level, then the ¥109 level would be tested for support. Breaking below there would change the entire attitude of the market so keep in mind we need to hold that for my thesis to continue.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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