Short Term Weakness for the Yen Possible?The Yen continues to hover near important support as it gets stronger.
However, we expect the short term to be complicated by the Japanese currency and some weakness to develop.
Yen Testing Important Mid-Term Support Levels
The Yen is trading near the 106.10 level this morning. The Japanese currency has battled its way to stronger values versus the U.S Dollar. A glance at a mid-term chart shows what looks like a comfortable trading range for the Yen.
But do not be fooled. The Japanese currency is testing important support levels as the U.S Dollar has been sold against the Yen. Some investors seem to be wagering the Bank of Japan will become more hawkish. However, there have been few signs of that occurring anytime soon.
Complicated Trading Ahead for Yen
Support for the Yen strength appears to be around 105.30, while resistance could be interpreted at 107.00 juncture. A look at a long-term chart of the Yen shows it has not been this strong since the summer and fall of 2016.
The Yen may continue to attract investors who sell the U.S Dollar versus the Japanese currency with a long-term view. However, we expect the near term to be more complicated, and would not be surprised to see some Yen weakness develop.
In the short term, we believe the Yen may be negative. The mid-term and Long term we are unbiased.
Yaron Mazor is a senior analyst at SuperTraderTV.
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