The US dollar has rallied again during the trading session on Friday to break above the ¥110 level. This is an important level from a psychological standpoint and of course the overall trend. After all, the market breaking above the ¥110 level is an area that has been important a few times in the past, and it now looks as if we are going to go looking towards the ¥111 level. With that being the case, I do think that it is only a matter of time before we reach that ¥111 level, and test a potential break out.
USD/JPY Video 31.05.21
To the downside, the 50 day EMA is offering significant support, and I think it is worth paying attention to as the market has closely followed it over the last several weeks, and I would anticipate that we continue to see it behave like that. That being the case, the market would be bought on dips as long as we can stay above there. If we break down below the 50 day EMA, then it is likely that the ¥108 level would be an area that should offer massive support. The 200 day EMA is starting to reach towards the ¥108 level as well, so it does suggest that we have plenty of buyers in that area, especially when you factor in the 38.2% Fibonacci retracement level being there at the same time. Nonetheless, if we were to break down below there then it could significantly destroy the uptrend. So far, it does not look likely to happen, so I am a buyer of dips.
