USD/JPY Technical Analysis – January 20 2015

The USD/JPY pair broke a little bit higher during the course of the day on Monday, testing the 117.50 region. This is an area that has been resistive lately, but ultimately we should see this market breaks above there as the buyers keep coming into this marketplace to push things higher. Ultimately, I believe that this market will then head to the 120 level, but that is a significant barrier as well. I believe that the consolidation should continue, with of course and upside bias.

The 115 level below should be supportive going forward, and I believe that’s essentially the “floor” in this market right now. With that being said, I will continue to buy dips every time they appear, as I believe that the uptrend is still in effect, and should reassert itself fairly soon. On a move above the 122 level, I believe we then go to the 125 handle.

The Bank of Japan continues to keep an ultra-loose monetary policy, and therefore think the Japanese yen will continue to be a currency that sold time and time again. The US dollar of course is the strongest currency in the world right now, and although the uptrend in the US dollar is a little long in the tooth, I feel that it should continue for the foreseeable future. I believe that ultimately this is a longer-term buy-and-hold type of situation, or at least buy on the dips. With that being said, I have no scenario in which I choose to sell this pair, or go against the US dollar in general. The Japanese yen of course is one of the last currencies I would want to buy right now, and therefore I will pass on any selling signals anytime soon. Careers will be made out of this move given enough time.