USD/JPY SIGNAL 22/09: US Dollar Continues To See Buyers

(MENAFN- Daily Forex) The US dollar initially fell against the Japanese yen during the trading session on Friday, reaching to the 50-day EMA before turning back around. It's worth noting that the Bank of Japan had an interest rate decision, and it, of course, didn't really do anything. But at this point in time, there are questions asked whether or not they will have to cut, despite the fact that the Federal Reserve cut on Wednesday.

Swap Still Pays

The reality is you still get paid to hang on to this pair. Whether or not the Japanese yen can pick up momentum and really starts to strengthen is a question of risk appetite, I think more than anything else. As things stand right now, the market seems like it's essentially neutral in this pair. And that makes a certain amount of sense as we can definitely get paid at the end of every day. So that's what I've been doing. I've been buying short term dips building up a position. And once we break above the 149 yen level, then we could go look into the 151 yen level. After that, then we could really go much higher. Hanging around the 200 day EMA, of course, offers a little bit of interest. And of course, so does the 50 day EMA, both are flat.

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And with that being the case, it makes a certain amount of sense that the market stays in a neutral trend. I think at this point in time, we are going to eventually have to make a decision. But when you zoom out over the course of the last couple of years, you see we're basically just sitting on top of a huge order flow area that people had been buying dollars to begin with.

This is a very quiet, boring pair, which is odd for the dollar against the Japanese yen. It's typically very volatile, but that can be taken advantage of in its own way and a little bit more methodical buying on dips, not over leveraging yourself. And I've been using this as a way to build small gains to my portfolio as I trade other pairs. Again, though, once we break the 149 yen level, I think we could see a bit of momentum.

EURUSD Chart by TradingView

Potential signal: I am buying this pair every time it drops near 147.50, with a stop of 60 pips, and collecting swap. On a move above 149, I am holding for a move to 151 at least.

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