The US dollar has plummeted yet again against the Japanese yen as the trend looks to be completely smashed. At this point, the market desperately needs to see some type of relief or perhaps more of a “risk on” type of attitude. Ultimately, this is a run towards safety as we have seen across-the-board, with the Japanese yen picking up a bit of strength. It is also worth noting that yields in the United States are starting to drop a little bit, and therefore it is likely to continue to work against the US dollar if we do in fact see some type of rally in bonds.
USD/JPY Video 17.01.22
At this point, it looks very likely that we will eventually find our way back down to the ¥112.50 level, an area that has been supportive more than once. By doing so, the market is more than likely going to continue to see selling pressure and rallies will probably show signs of exhaustion that people will be taken advantage of. Ultimately, I have no interest whatsoever in trying to buy this market without some type of significant turnaround in the greenback across-the-board. I think at this point, we are probably going to see this driven more by the yen than anything else, as we have seen so much in the way of noisy behavior and of course fear as the Federal Reserve looks to be tightening into a slowdown. This being the case, the next couple of days could be noisy, but quite frankly I think the trend has turned around and that we are going much lower.
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This article was originally posted on FX Empire
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