USD/JPY Forex Signal 29/09: Pulls Back Against Yen (Chart)

(MENAFN- Daily Forex) Potential signal:

• At the ¥149 level, if we bounce and show signs of bullish pressure reenter in the market, I would be a buyer with a stop loss at the ¥147.85 level, and a target of ¥153.

Friday had seen the US dollar pulled back just a bit against the Japanese yen. This makes a certain amount of sense, considering that we have just broken through a major resistance barrier. People were going to either want to take profit, or at the very least, lighten up their positions.

Furthermore, it makes a certain amount of sense that we retest the previous resistance barrier for the rectangle that we had been trading in, so this could just end up being a nice“breakout, pullback, retest, and continuation” pattern Analysis

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The technical analysis for this currency pair has suddenly shifted into a positive tone over the last several days, which makes a certain amount of sense considering that the FOMC press conference didn't exactly give everybody what they wanted, meaning that the Federal Reserve may have to still be somewhat“data dependent.” Match that with Japan, which had an interest rate decision 2 days later, that didn't exactly have people looking at Japan as an economy that was going to have to tighten monetary policy aggressively. In other words, last week made this pair shift its attitude, and now that we have broken out of the 300 pips range, it looks like we could go much higher.

EURUSD Chart by TradingView

I'll be watching to see if the ¥149 level, the previous resistance level, offers support based on“market memory.” If it does, then I would be adding to a position that I'm already in. On the other hand, if we break down below there, then I'll be watching the 200 Day EMA which is near the ¥147.85 level. On the upside, if we can break above the ¥151 level, then it's likely that we could go much higher, and it could be a major signal that we are going to continue a longer term uptrend like we had seen previously.

I hold onto this pair mainly due to the fact that we get paid at the end of every day, and as I've been very patient over the last months staying long of this market, that swap has started to really build up. It has padded my position, and therefore I am willing to ride the waves that cause pullbacks.

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