The US dollar has risen against the Japanese yen on Monday, but not without massive swings.
USD/JPY
The US dollar has found itself to be positive against the Japanese yen yet again on Monday, although some are talking about potential yen intervention in the middle of the day. The 162-yen level is still a bit of a barrier to overcome, but in the short-term part of the day and in the New York session, we saw a massive drop to 161.80 yen, but a turnaround almost as quickly.
Top Regulated Brokers
So, the question then becomes, did somebody just blow up, or was it an intervention? Perhaps it might have been a blow-up. I'm still bullish on this USD/JPY pair. I have no interest whatsoever in shorting, and in fact, on drops like that, I look for buying opportunities. I think that the US dollar has much further to go against the yen, and as you get paid at the end of every day, it becomes an investment, not so much a trade.
Because of this, I like the idea of trying to look at this market through the prism of when there's value. The 50-day EMA is hanging around the 160-yen level, which is a large, round, psychologically significant figure, and an area that had been so heavily defended by the Bank of Japan.
Technical Patterns and Long-Term Projections
Ultimately, when I look at this pair, it looks like we're in the midst of an ascending triangle, and that measures for a move to 163 yen. I think if you're patient and just add slowly, this is going to be a career-making trade for some of you, if you can be patient enough.
When you look at the longer-term kind of bottoming pattern, and really you have to look at this through the prism of a multi-year situation. When you do the measured move going back to 1986, you're really talking about a move to 224 yen, possibly more. So, I do think this is a market that, if you continue to hang on to it, it will pay over a longer term. It's just that you'll have to be patient, and you cannot get overleveraged.
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