The US dollar has dipped ever so slightly against the Japanese yen during the trading session on Monday, as we continue to hang about the 50 day EMA.
The US dollar has drifted a little lower during the trading session on Monday, in what would be thought of as a very non-consequential trading. We are sitting on top of the 50 day EMA, which is currently offering a little bit of support. Whether or not we get a bigger move is a completely different question, but right now it seems as if we are somewhat content to simply sit here. The ¥113.50 level is an area that has mattered a couple of times, so it is not a huge surprise to see that we would be hanging about here.
Keep in mind that the indecision of the market is a potential outcome for the next couple of weeks, as we are going to continue to see a lot of noisy behavior and what will be thin trading. I would not be surprised at all to see this market settle into a 100 PIP range for the next two weeks. Because of that, I think it is probably more or less going to be a situation where you have to look at it through short-term range bound type of system, but I would also keep my position size somewhat small, due to the fact that the later we get into the year, the more threat there is of a sudden spike in one direction or the other due to thin trading conditions.
That being said, I believe underneath at the ¥112.50 level is massive support, just as the ¥115 level above is massive resistance. Keep your position size reasonable was the most important thing to do during the last two weeks of the year.
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Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.