(MENAFN- Daily Forex)
The USD/JPY faced a significant downturn during Friday's trading session, primarily driven by the release of a disappointing jobs report that fell short of expectations. This unforeseen development has cast a shadow of uncertainty over the market, potentially impacting the prevailing uptrend's trajectory. However, I think this will be but a blip on the radar when it comes to this trend.
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The critical juncture lies in the breach of the ¥150 level, a milestone that would undeniably signal a strong bullish sentiment. Such an event might reinvigorate the market, paving the way for a resurgence towards prior highs. Nevertheless, it's important to acknowledge that the market remains plagued by the persistent speculation surrounding the Federal Reserve's actions, contributing to an atmosphere of ambiguity.
Beneath the surface, the 50-Day Exponential Moving Average stands as a significant support level. Its potential to provide substantial support cannot be overlooked. While the interest rate differential between currencies remains substantial, recent developments in the US bond markets have witnessed a decline in yields. This transformation is clearly reflected in the charts, but it's merely a matter of time before traders regain their footing and inject fresh momentum into the market to Buy This Pair
Contemplating the downside scenario, a breach below the ¥147.80 level could signify the possibility of a more pronounced downward movement. Such an outcome may indicate the potential for a more extensive correction. However, it's worth highlighting that value-oriented traders are likely to re-emerge in the market, especially considering the distant prospects of the Bank of Japan entertaining the idea of tightening its monetary policy. With this, I think it is only a matter of time.
In essence, the current market conditions present an opportune moment to acquire US dollars at an attractive valuation, aligning with the idea of buying into weakness. It's noteworthy that we observed a minor rebound during the trading session following the initial descent. However, exercising prudence is paramount, and it would be wise to await the conclusion of this candlestick before contemplating any buying decisions. Moreover, entering the market just ahead of the weekend may entail an unnecessary degree of risk, requiring careful consideration of one's strategy.
Potential Signal: I am a buyer only in this pair. If we rise above the 150 level, I will enter. Stop loss is 149. Target will be 152 above. Ready to trade our daily Forex signals ? Here's a list of some of the top 10 forex brokers in the world to check out.
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