The United States dollar initially fell against the Japanese yen but then turned around to show signs of strength later in the day. As we wait the FOMC meeting, the question now remains whether the Federal Reserve will raise interest rates. Quite frankly, looks as if the US dollar has already made up its mind, and that it is going to go higher. There’s been a lot of bullish pressure in the stock markets around the world, and that tends to help the USD/JPY pair. Pullbacks should find support near the 111.75 level, and of course the 111 level under that. I believe that eventually we will go looking towards the 114.50 level, but we will more than likely chop around between now and then.
I believe that this is a market that we can continue to buy dips in, as there seems to be more than enough buyers going forward. The 114.50 level offers significant resistance and I think runs to the 115 handle. Once we break above there, the market will continue to go much higher, but I think it’s going to take us several attempts to finally make a breakout, so don’t expect it to happen right away. That’s why we buy dips in this market, because we are trying to pick up the momentum. As far as the downside is concerned, I believe there is a hard “floor” in the market well below us at the 110 level.
Written by FX Empire