The US dollar has rallied a bit during the course of the trading session on Monday as the USD/JPY pair continues to hang about the ¥110 level. This is essentially a “magnet for price” that the market has been hanging about for a while, so I do think that it is only a matter of time before we see some type of bigger decision but every time we pull away from that level, it seems like we go right back towards it. Because of this, I think it is only a matter of time before longer-term trading comes back into the picture, but it is obvious to me that the market is a bit confused at the moment.
USD/JPY Video 24.08.21
The 50 day EMA is sitting just below the ¥110 level, and going flat, so that is a further reason to think that perhaps the market is going to stay essentially flat as well. When you look at this chart, you can see that the 200 day EMA is reaching towards the ¥109 level, which has been the support over the last couple of months, while the resistance has been at the ¥110.75 level. I believe that we stay in this range until we get through the month, as it tends to be a very quiet month for Forex anyway.
We do have the Jackson Hole meeting on Wednesday that could produce some headlines, but at this point I think the markets are simply killing time trying to figure out what to do next. This is probably more of a September story than anything else at this point in time. However, I will use this chart for a secondary indicator with yen related pairs.
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This article was originally posted on FX Empire
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