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Christopher Lewis
USD/JPY

The US dollar initially tried to rally against the Japanese yen during the trading session on Wednesday but gave back the gains to turn around and show a less than attractive candlestick. However, the 50 day EMA is sitting right here and flattening out, so it shows just how lost this pair seems to be. To the upside, the market sees plenty of noise all the way up to at least the ¥108 level, where we see the 200 day EMA. Ultimately, this is an area that will continue to be problematic, so I do not have much in the way of interest in trading this market, but if we were to turn around a break down below the lows of both Monday and Tuesday, then I think the market is likely to go looking towards the ¥106 level underneath which has been important more than once.

USD/JPY Video 09.07.20

At the ¥106 level, we had seen a bit of a double bottom form, and that of course is an area where I would anticipate the market moving towards. I also believe that the market will bounce from there. However, if we were to break down below that level it is likely that we then go looking towards the ¥102 level afterwards. To the upside, if we were to break above the 200 day EMA, then we could go looking towards the ¥110 level above which has been a significant barrier previously. As both of these are considered to be “safety currencies” and therefore it is likely that we continue to see a lot of choppy behavior.

For a look at all of today’s economic events, check out our economic calendar.

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