US Dollar Gives Up Early Gains Against Yen for the Week
The US dollar has had a rough week as we initially rallied during the trading week to reach towards the crucial and psychologically important ¥115 level. That is an area that we have seen a lot of noise at, and of course a lot of attention. We sold off quite drastically from that level and now it looks as if this pair could very well break down. At this point in time, the ¥112.50 level underneath should be supportive, and therefore I think that could be our target. If we break down below there, then the market is likely to go looking towards the ¥110 level. All things been equal if we continue to see a major “risk off” type of situation around the world, that will almost certainly weigh upon this pair as well.
USD/JPY Video 24.01.22
Keep in mind that the US dollar will probably strengthen against most currencies, but the Japanese yen is considered to be a major safety currency, so at this point in time I think it does make a certain amount of sense that even if this pair falls, it may be “less bad” than many other currency pairs. If you are looking to buy the Japanese yen based upon “risk off”, you are probably better off shorting something like the NZD/JPY pair, and then of course the other pairs like the GBP/JPY and AUD/JPY. While the USD/JPY pair could very well fall, it probably will not fall as hard simply due to the fact that people will be buying the US dollar against multiple other currencies. More or less a way of looking at it through relative strength or weakness.
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