Tactics and Analysis, August 14, 2017 – New Round of Yen Speculation on Horizon

The Yen has added plenty of value against the U.S Dollar in the short-term. However, its gains may have been made to swiftly and speculators may look for reversals in fortune in the short-term. The Japanese government issued a positive GDP report this morning.

Yen’s Short-Term Strength

The Yen has produced significant short-term strength as the U.S Dollar has become weaker and risk adverse traders have bought the Japanese currency.

The 109.50 level is being tested between the Yen and U.S Dollar today, and an intriguing test of range is likely to be seen the entire week.

Support for the Yen appears to be around 109.00 and resistance in the short-term is firmly near 110.00. However, because of the recent volatility within forex these levels may falter.

Two Dynamics at Work for Yen

Two dynamics have been encountered already this morning for traders of the Yen. Gross Domestic Product numbers from Japan showed a solid improvement. And the geo-political tension between the U.S and North Korea has become relatively calm.

The U.S Dollar has been slightly stronger against the Yen because of these two developments this morning. And sets up the prospect for a continued test of ranges in the coming days.

Yen’s Gains have been Fast

The U.S Federal Reserve is unlikely to change its monetary policy until late this year at the soonest. And the Yen may find in the long-term, reasons for it to become stronger against the U.S Dollar.

However, in the near term, the recent gains in value the Yen have made may spark speculative traders who think the Japanese currency has gained value too fast, and they may buy the U.S Dollar as they seek reversals.

In the short term, we believe the Yen may be negative. Mid-term and Long-term we are unbiased.

Yaron Mazor is a senior analyst at SuperTraderTV.

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