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Christopher Lewis

The US dollar rallied significantly during the trading session on Friday, reaching towards the ¥108.50 level, an area that has offered a bit of resistance previously. If we can break above there, then it’s likely that the market goes looking towards the 110 level after that, followed by the ¥111 level. All things being equal, this is a market that is going to chop around quite a bit, as the Japanese yen and US dollar both are considered to be safety currencies, although this pair tends to move right along with stock markets. With that being said, they are all over the place but looking like they are trying to go long again.

USD/JPY Video 06.04.20

To the downside, the ¥107 level underneath should be support, but if we do break down below there it’s likely that the market could then go down to the ¥106 level and then the ¥105 level which of course attracts a lot of attention. Furthermore, we could even drop all the way down to the ¥101 level which is where we had crashed into previously. Looking at this chart, it looks like we are simply chopping around and trying to wipe out trading accounts. I mentioned this yesterday, I don’t like this market are right now, as there are much cleaner set ups in other currency pairs. That being said, the market is likely to be noisy going forward as the headlines crossed the wire about coronavirus figures. Quite frankly, I am extraordinarily neutral on this pair right now and don’t feel the need to be putting money to work until we get closer to the ¥111 level or the 100 to yen level.

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