Is the Yen Ready to Break 114?
The Yen has been a personal favourite trade of mine lately. The round number levels are always important for the USD/JPY and in recent times we’ve seen how 113 and now 114 have been acting as long-term resistance levels.
If you recall it took a fair bit of effort for the Yen to break out above 113. It was only Trump’s Tax Reform’s getting some traction that ultimately sparked the USD and saw us rally. I feel the same way about 114.
114 is the Key Level
While we have tested it a few times and actually run up as high as 114.50, we haven’t really held in that region above it and if you looked at a long-term chart you’d suggest that it failed. With that in mind, I do think we will strengthen as we near next month's FOMC. However, a strong jobs report on Friday might be the catalyst we need.
If we put in a strong number then I feel that will strengthen the case for a rate hike. As it stands I’m not going to be a buyer just yet, until we have something fundamental that will help us hold this level.
USD/JPY – 240 min Chart.
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