Bullish patterns and interest rate differentials suggest a favorable long-term outlook for the USD/JPY pair.
The US dollar initially tried to rally during Friday’s trading session, but profit-taking activity dominated the market as traders sought to capitalize on recent gains. The current price increase should not come as a surprise given the impulsive nature of the recent move. As the weekend approaches, the market may see a slightly significant drop. However, this pullback could present an attractive buying opportunity for those interested in acquiring “cheap” US dollars or selling overvalued Japanese yen.
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Looking at potential price levels, the ¥142.50 mark supports the US dollar. Hence this download phase may mark the beginning of a consolidation period. On the other hand, the ¥145 level represents a significant barrier of resistance and it will be interesting to see how the market reacts around this level. A break above ¥145 would likely trigger a significant rally. However, the market’s recent struggles suggest that a pullback is logical and necessary to restore momentum.
Several bullish patterns have emerged to support the positive outlook US Dollar to Japanese Yen. A breakout from the bullish flag formation suggests a potential move towards the ¥148 level. Additionally, the ascending triangle pattern also indicates a target in this area. These patterns provide further evidence of bullish market sentiment. However, a temporary pause or pullback is not only likely, but also rational, given the recent energy surge.
The significant interest rate differential between Tokyo and the US central bank is contributing to the significant divergence between the two currencies. This mismatch supports the continued bullish momentum of the USD/JPY pair over the long term. Resultant exchange it offers traders an additional incentive to hold this currency pair. It is important to consider these underlying factors when assessing potential future market movements.
With the upcoming US holiday on Tuesday, it is likely that many large US businesses will effectively be closed on Monday as well. This scenario can still encourage collecting profit activities between market participants. As a result, the market could witness a temporary decline in prices.
The recent recovery in the US dollar has fueled profit-taking activities, leading to a phase of market consolidation. With the market experiencing a slight decline, it presents an opportunity for traders looking to get “cheap” US dollars or sell the overvalued Japanese yen. Key support is around the ¥142.50 level, while the ¥145 mark represents a significant resistance barrier. Bullish patterns and interest rate differentials suggest a favorable long-term outlook for the USD/JPY pair. However, a respite in the form of a pullback is expected before the market returns to its upward trajectory. With the US holiday approaching, profit-taking activities may intensify.
- USD/JPY is likely to see a decline at this point.
- The move to level 143 is a buying opportunity as I see it.
- The 142.50 level is short-term support, so my stop loss will be wwwww.
- The goal is level 146.