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Yen Strength May be Challenged Short Term

By:
Yaron Mazor
Published: Feb 19, 2018, 11:57 UTC

The Yen remains within the upper boundaries of its value versus the U.S Dollar and its trend has been strong.

Yen

But speculators may be tempted to look for weakness in the short term and buy the U.S Dollar against the Japanese currency.

Yen’s Strength Remains Intact

The Yen has weakened from the strongest part of its short-term range. The Japanese currency remains among the most valuable ratios versus the U.S Dollar and is near 106.50 as of this morning. Friday and early trading today have seen the U.S Dollar bought against the Yen and resistance look to be about 107.50, with support near 106.00.

USD/JPY 1H Chart
USD/JPY 1H Chart

The Nikkei Index gained nearly 2% today via its equities. The Yen is certainly still testing highs not seen for 15-month highs, and it may continue to do so – but short-term opportunities exist for range traders.

Range Trading Tempting for Yen

The Yen’s recent strength should be looked at closely with a long-term weekly chart, like the one provided here. The Yen could be entering a new range which it has not traversed since June of 2016 before getting stronger, and then eventually weakening after the U.S Presidential election of Donald Trump.

USD/JPY Weekly Chart
USD/JPY Weekly Chart

The Yen could be facing a change of outlook via investors who think the Bank of Japan will have to tighten monetary policy eventually. However, near-term a test of the range is likely still in the cards.

In the short term, we believe Yen may be negative. The mid-term and Long term we are unbiased.

Yaron Mazor is a senior analyst at SuperTraderTV.

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About the Author

Yaron Mazorcontributor

Yaron has been involved with the capital markets since 1998. During the past 16 years, Yaron has been a day and swing stocks trader in the American market. Yaron has founded and made successful investments into businesses spanning exciting industries – from apparel to restaurants and bars, to high tech, medical technology, and education.

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