The US dollar has rallied significantly during the week, slicing through the ¥110 level. By doing so, it looks as if we are ready to go higher, as the market has been banging up against that level for some time now, forming a couple of shooting stars on the weekly chart. We are closing towards the top of the overall range, and I believe this point it’s likely that we continue to go higher because of this. I think a short-term pullback is likely to happen, but I think it will only offer a buying opportunity for those who are patient enough to wait for it.
Longer-term, I believe that the market will probably go to the ¥112.50 level, an area that has been important on short-term charts. Longer-term, I believe that the market should then go to the ¥115 level after that which has been significantly resistive. I think that a break above there would send this market into a multi-year long-term uptrend. I think we are trying to do that anyway, as interest rates in the United States continue to climb while the Bank of Japan looks likely to be very quiet. I believe that the market is going to be almost impossible to sell, and I believe that there is a “floor” in the market closer to the ¥107.50 level underneath. Longer-term, I think that the market continues to find reasons to expand to the upside.