The US dollar has gone sideways against the Japanese yen during the trading session again on Wednesday as we continue to be stuck just below the ¥112 level, which I do believe is a major area of supply. That being said, if we can break above the ¥112 level on a daily close, AND the S&P 500 can break out, this could be a massive move higher. However, as things stand right now neither market looks ready to take off, so it’s going to be difficult to have that happen.
USD/JPY Video 07.03.19
If the market were to break down below the ¥111.50 level, then we could continue to go towards the ¥110.50 level. Overall, I think that this market probably will be susceptible to headline shock, as the Japanese yen is quite often used as a proxy for Asia, and of course we have the US/China trade relations going on right now, which will not only affected the currency markets but will also affect the coordinating S&P 500 market.
To the upside, the target initially would be ¥113.50, perhaps even the ¥114 level given enough time. Looking at this market though, I think you should wait until the end of the day to try to place a position, because we will have a lot of noise in this market. However, if we can get a profound close outside of the short term range, that could finally be the “all clear” to trade this market. If you are a short-term scalper, this could be a good place for you.
Please let us know what you think in the comments below