CHF/JPY Forecast Today -5/12: CHF Strengthens Vs JPY (Chart)
Date
12/5/2024 4:38:37 AM
(MENAFN- Daily Forex)
During my daily analysis of the JPY-related currency pairs, the CHF/JPY pair has caught my attention, as it has bounce from a crucial support level. The ¥160.50 level has been important for some time, and it has seen both buyers and sellers in that same vicinity. The fact that the market has shown itself to be reliably supported during the trading session and of course the Tuesday session featured a neutral candlestick suggests to me that we may see a little bit of follow through.
For what it is worth, the other Japanese yen related pairs bounced as well. All things being equal, the market is likely to continue to see a lot of noisy behavior, but I also recognize that the Japanese yen tends to move in the same direction against almost all pairs. It is because of this that I use the CHF/JPY pair as an indicator just as much as I do a trading vessel. In other words, if the market were to rally a bit from here, it suggests that the Japanese yen will be weaker than the Swiss franc. This is important because both of these are what most people think of as“funding currencies”, suggesting that if you are looking to take advantage of the carry trade, you are looking to short the Japanese yen if we start to bounce again.
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The ¥168.50 level has been important multiple times, so the fact that we saw a bit of“market memory” in this market suggest that we will continue to see this area be important, and judging by the action that we had seen on Wednesday, I think it ends up being a bit of a short-term floor in the market. Just above, we have the 200 Day EMA near the ¥171.47 level, which will be your next target. The fact that we are closing toward the top of the candlestick does suggest that there is plenty of momentum, so I believe this pair will continue to be bullish, at least in the short term.
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