US Dollar Continues to Power Higher Against Yen

The US dollar has rallied significantly during the trading session on Friday to show signs of life, and therefore it looks as if we are getting ready to try to break out again. If we can clear the current area, it is very likely that we go looking towards the ¥120 level. We are overdone at this point though, so I still believe that you are best served to wait for some type of pullback in order to find value. After all, chasing the trade all the way up here is probably a serious problem.

USD/JPY Video 21.03.22

We could drop all the way to the ¥116 level as it is the major support level underneath here. That being said, the 50 Day EMA is starting to rally a bit and it looks like we are trying to get to the upside overall with momentum. I think somewhere in that area, we should see plenty of value hunters. The market more likely than not continue to go higher based upon interest rate differential, and the Japanese yen continues to get hammered against almost everything.

I have no interest in shorting whatsoever, this is obviously a very bullish market, but at this point in time I think a pullback is desperately needed. That pullback will simply tell me to sit on the sidelines and wait for value, and perhaps a supportive daily candlestick. Markets cannot go straight up in the air forever, and therefore if you are not actively trading this market already, it is probably best to simply observe it. Volatility is about the only thing you can count on.

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