US dollar falls against Japanese yen during the Friday session
The US dollar has fallen significantly against Japanese yen on Friday, bouncing from the ¥109 level in turn. The question now is whether we can build up enough momentum to continue going higher? I do think that we will eventually, because when you look at the longer-term charts you can see that the market rolling over and forming a shooting star is in direct reaction to the ¥110 level, but we also have several supportive looking candles underneath, so I think that eventually the value hunters will come back in and pick up the US dollar as interest rates will continue to rally and go higher.
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Remember that this pair is highly sensitive to geopolitical concerns, and of course any words that cross the wires about trade wars. I think if we can stay out of some type of major trade war, then eventually the value hunters will push to reach towards ¥110 again, and then even higher than that. If we do break down, the ¥107.50 level underneath should be massive support, as it was previous resistance. Market memory should serve this area well, and although I think it will be very choppy, given enough time we should find plenty of reasons to go higher. I believe that the next couple of sessions may be very difficult, so if you keep your trading position relatively small, you can ride out all of the noise that we are almost undoubtedly going to see.