The US dollar rallied a bit during the trading session on Tuesday, as we continue to see the ¥108.50 level offer a bit of support. We also have moving averages in the neighborhood that could have an effect on support as well. The 50 day EMA is just below and the 200 day EMA is slicing through the middle of the candle body. We are getting ready to see the 50 day EMA break above that 200 day EMA which is the so-called “golden cross.” That of course is a longer-term “buy-and-hold” signal, so pay attention to it when it happens.
USD/JPY Video 11.12.19
Looking at this chart, if we were to break down below the ¥108 level, that would of course be a very negative sign, perhaps opening up the door to the ¥107.50 level. Ultimately, I think that this market probably finds plenty of buying pressure eventually, especially if we get some type of movement in the US/China trade relations situation that of course has such influence on risk appetite. This is a pair that is highly sensitive to risk appetite, so pay attention to the stock markets in the United States as a proxy, as I have quite often used the S&P 500 as a bit of a proxy for risk appetite and watched it move right along with this pair. Ultimately, I think that the ¥110 level is the gateway to much higher prices. If we can break above there, then the market is likely to go to the ¥111 level which is the scene of a gap, and then eventually the ¥112.50 level.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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