Against the backdrop of market noise and volatility, the US dollar initially fell on Tuesday, but since then, the US dollar exchange rate has shifted significantly higher. The US dollar also maintained a strong upward trend against the Japanese yen. The target is a resistance level of 150 yen. This level has significant psychological importance and may be closely monitored by traders. If the market successfully breaks through this threshold, the possibility of reaching the 152 yen level will become increasingly high.
On the other hand, if it falls below the low point of the candle on Tuesday trading day, it may push the market to a level of 147.80 yen. The characteristic of this region is its historical support level, rooted in market memory, and previously a significant resistance level. Adding potential support is the rapidly approaching 50 day moving average, which reinforces the importance of this level. Here, buyers are expected to intervene in pursuit of what they consider a "cheap dollar".
The continued attractiveness of the US dollar is based on favorable interest spreads. Compared to the monetary policies of other major central banks, the Bank of Japan maintains a very loose monetary stance. This discrimination continues to affect the yen, making it less attractive to most investors. Therefore, the timing for the currency pair to break through is ripe, and any pullback is considered a value proposition.
Given the continued strength of the US dollar and positive technical signals, it is currently impossible for many traders to sell in this market. The candle shape itself indicates an increasing pressure to drive the market higher, indicating an imminent upward trajectory. Despite previous concerns that the Bank of Japan may try to curb the depreciation of the yen, the prevailing reality is that such measures are futile.
In the end, the US dollar demonstrated extraordinary resilience amidst market noise and volatility. The key level, especially the 150 yen level, will determine the future trend of the currency. The interest rate spread remains a key factor in favor of the US dollar, while the loose monetary policy of the Japanese yen continues to weaken its attractiveness. Traders adopt a cautious attitude and avoid selling in the market, as the path with the least resistance indicates further strengthening of the US dollar.
