Wednesday, 08 December 2021 12:33 GMT

USD/JPY: After Long-Term Highs Attained, Quick Spike Lower


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After touching price levels not seen since March of 2017 in early trading this morning, the USD/JPY reacted with a swift spike lower and the 114.500 mark was challenged. However, since hitting this low which was traded yesterday, the USD/JPY has established some stability and is maintaining eyesight of the 115.000 juncture. The USD/JPY remains within the upper realms of its long-term charts.

Technical traders will seriously want to look at five-year charts to see the USD/JPY has surpassed highs made in late 2017 and the fall of 2018. The ability of the USD/JPY to maintain an upwards trend since the beginning of this November, when support near the 1132.350 mark proved to be strong has served as a propellant for speculative bullish traders who have been buyers.

The USD/JPY has traded within these higher price realms before historically. While skeptical traders may believe now is the time to be contrarian and begin selling the USD/JPY, they could be making a costly mistake if the upwards momentum continues to be demonstrated.

The ability of the pair to surpass long-term highs now puts its within sight of values achieved in late 2016 and early January of 2017. While the current price of the USD/JPY has fallen in the last couple of hours to nearly 114.600, if these higher realms are maintained and the 115.000 is again tested there is reason to suspect an additional push upwards can occur.

Sellers who want to look for more short-term reactions, which believe the 114.400 to 114.000 level will see a momentary challenge, are encouraged to use strict stop losses . Yes the USD/JPY will certainly see cyclical movement as it trades, but there is reason to suspect if short-term support levels are challenged that this may be an opportunity to buy the USD/JPY and look for bullish moves higher.

The USD/JPY has moved with a good amount of velocity early today because the Forex pair is near important highs. Traders should be prepared for rather quick conditions to continue near term over the next day before U.S. financial institutions disappear for their long holiday weekend which begins on Thursday.USD/JPY Short-Term Outlook

Current Resistance: 114.200

Current Support: 113.810

High Target: 114.440

Low Target: 113.460

 

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