The US dollar fell significantly against the Japanese yen during trading on Wednesday but bounced back above the ¥110 level to use the 200-day moving average as support, as well as the large come around, psychologically significant figure. Because of this, I think that the algorithms kicked in during the session as buyers came to the rescue. I believe higher interest rates in the United States will continue to drive this pair higher, and that it’s only a matter of time before we reach towards the ¥111 level. Even if we did break down from here, I anticipate that there is even more support at the ¥109 level. I don’t have any interest in shorting, at least not right now and I think that during the next few months we should see a move towards the ¥112.50 level as the US dollar should strengthened during the summer.
The Australian dollar fell initially during trading on Wednesday but found enough support at the 0.75 region to turn around of form a little bit of a hammer. This is encouraging for Aussie bulls, as this shows that the large number is trying to keep the market afloat, but I see the area above as being very resistive, and quite frankly I think that it is going to be a tall order for this market to not only break above the previous uptrend line, but also the 0.77 handle. I think signs of exhaustion will be selling opportunities, and I will use them as such. I also think that we will more than likely go down to the 0.7350 level during the summer. However, I am the first to admit that I would be a buyer on a break above the 200-day moving average as plotted on the chart.
This article provided by NewsEdge.