The US dollar has rallied a bit against the Japanese yen on Friday as we have seen a lot of interest rate movement and news during the session.
USD/JPY
The US dollar has rallied a bit against the Japanese yen during early trading on Friday but struggled to stay above the 50-day EMA. This does make a certain amount of sense considering that we had shot straight up in the air over the last couple of days. And of course, we had a ton of economic announcements during the session that I think will continue to be important to really parse through the weekend.
We've got the advanced GDP numbers in the United States being weaker than anticipated, but we also have a partial government shutdown, so it certainly distorted the numbers. We had core PCE numbers coming out hotter than anticipated and that of course is something that is probably a little bit more believable and that could keep up the higher for longer narrative for the Federal Reserve.
Bullish Outlook Amid Profit-Taking and Support Levels
Therefore, I remain bullish in this market, but I think we're just a little overdue. The Supreme Court just struck down the vehicle through which tariffs were levied against foreign countries in the United States. It doesn't kill the tariffs. The tariffs can be placed in other ways. So, I think there's a lot going on, a little bit of profit-taking heading into the weekend.
A pullback at this point I do think opens up the possibility of finding some value. And that value of course is something that I think a lot of people would be willing to take advantage of with the 200-day EMA and the 152-yen level both offering a floor. I'm looking for value. I'm taking advantage of it as the interest rate differential will continue to favor the buyers.