USD/JPY rebounds on Tuesday

The US dollar has rallied during the trading on Tuesday, reaching towards the 106.50 region. If we can break above there, the market then goes to the 107.50 level over the longer term. However, this is a market that is highly sensitive to risk overall, and with this being the employment week, it’s possible that we will see a lot of choppiness between now and then. If we can get the jobs report all the way, then the market can decide here as well. Beyond that, I think that the market will be very difficult, so you should use caution and make sure that you are very careful in general.

The 105 level underneath is the “floor” of the market, and I think until Friday, it’s good to be very unlikely that we break down below that level, unless of course we get some type of headline coming out of the China and the US when it comes to the potential trade war that we may be witnessing. Because of this, I think that short-term trades are probably about as good as it gets, but eventually we should see some type of decision being made that we can follow. If we break above the 107.50 level, the market should be free to go to the 110 handle. However, if we break down below the previously mentioned 105 level, the market should then go to the 101 handle. I think that participants will continue to be very quick to jump in and out of this market with everything that’s going on.

Written by FX Empire