US Dollar vs Japanese Yen Weekly Technical Analysis
The US dollar has gone parabolic against the Japanese yen over the past week as you can see, reaching the ¥122.50 level. This is an area that more likely than not will continue to see hesitation, simply because the market had gotten so far ahead of itself. Keep in mind that markets cannot go straight up in the air forever, so something almost certainly will have to be done about this situation. A pullback would not only be expected, but it would be healthy after this type of movement.
It is worth noting that the area that we are currently probing is a massive barrier on the monthly charts, so it would take a significant amount of momentum to make this thing truly kick off to the upside. That momentum is very hard to find when you have gotten all the way up here in such a short amount of time. However, if we were to do that, it would certainly be an even more dangerous situation than we are in now.
On a pullback, I would anticipate that the ¥120 level makes a certain amount of sense, as it is a large, round, psychologically significant figure, and an area that has been important in the past. After that, we then have the ¥117.50 level, as on the daily chart the 50 day EMA seems to be racing towards that area.
It is not even that I think shorting this market is the prudent thing to do, it is more like I believe this is a market that has gotten far ahead of itself.
USD/JPY Technical Analysis Video 28.03.22
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This article was originally posted on FX Empire
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