Greetings Fellow Traders!
I thought today would be a great today for a quick overview of the USDJPY…
If you are a forex trader, you know the USDJPY has been in a consolidation phase for many, many weeks now, with a strong support level having formed on the longer term charts. With the falling of the US Stock Market and the strengthening of the USD, we may be preparing for a sharp rise in this currency pair. The best part of this long term BUY in the USDJPY that is setting up, is the “threat” of the Bank of Japan intervening in the Yen to weaken it’s own currency. This type of intervention has recently happened with the Swiss (CHF) currency which sent all the currency crosses soaring up to, or more than, 1000 pips in minutes. The BOJ wants its Yen weaker to support its economy and make import/export business more profitable with the rest of the world. Many traders of speaking of intervention, but it has yet to happen. The current price on the USD/JPY is 76.608, with very strong support under the 76 handle. If this price should break, we will likely see high market volatility and an increased likelyhood for intervention by the BOJ.
Our status is a LONG/BUY position on this pair, looking to hold and collect pips as the price rises over the past several days and weeks. Be wary of spikes as you can see on the 1 and 4 hour charts as the pair has been making higher highs and higher lows, but without the breakout coming, channel trading may be advised.
We plan to have our new http://www.FastPips.com site up and ready by mid-October 2011. Happy trading!
