The USD/JPY appears to be in a rather intriguing value range via its current price realm. Currently the USD/JPY is around the 147.170 ratio with typical fluctuations being demonstrated. Speculators who have been pursuing bearish momentum in the currency pair know the USD/JPY hit a low of 146.240 early on Monday before incrementally raising in price.
The lows hit early this week, had last been seen on the 11th of September and on that day a depth of 145.900 was challenged. The move higher the past couple of days in the USD/JPY is a natural part of Forex trading. Speculators who are placing quick hitting trades and pursuing technical directions likely understand the ups and downs of the USD/JPY quite well and are not immune to placing buying positions on the currency pair even if they continue to think the mid-term outlook is bearish.
USD/JPY and the Potential to Change Direction Again
However, what now may be catching the attention of these seem technical traders, is that resistance with near-term considerations could be suggesting another move lower could occur. Risk management is certainly going to have to be used with the USD/JPY. It can become volatile without much impetus, this because it is a massively traded currency pair via its global volumes. The 147.290 to 147.430 levels look like they should be monitored.
Without much noise the Tokyo Core Consumer Price Index numbers were released on early Tuesday and came in slightly below expectations. The Bank of Japan has been stubborn and kept their interest rates low even while inflation became a thorn in the side of Japanese consumers. However, the statistical evidence that inflation may be eroding in Japan will make the BoJ confident regarding its approach. Behavioral sentiment regarding global risk sentiment remains important in the USD/JPY.
Recent Climb Could Prove Temporary in USD/JPY
- Traders may believe the recent incremental moves higher in the USD/JPY are likely looking at near-term resistance and buying could run out of power. If the higher levels prove durable, this could ignite the prospect for selling in the USD/JPY.
- Traders should note that U.S jobs numbers will be released this Friday and could prove to be a lynchpin for volatility in the USD/JPY. Before the data is released the USD/JPY may test its near-term price range.
- Financial institutions appear to still be leaning towards the notion of a weaker USD over the mid-term. Recent moves higher by the USD may simply be part of the natural Forex landscape and near-term resistance levels will prove important. If global risk sentiment remains optimistic this could help spur on reversals. Speculators need solid risk taking tactics if they are pursuing lower moves in the USD/JPY and they should not be overly ambitious.
USD/JPY Short Term Outlook:
Current Resistance: 147.270
Current Support: 147.050
High Target: 147.430
Low Target: 146.690
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