The USD/JPY currency pair is currently exhibiting a bullish upward momentum, with prices reaching a new high yesterday compared to the lows experienced in June. This surge in price has propelled it above both the 200-day and 50-day Moving Averages, indicating a positive trend.
There are two potential scenarios to consider for this market:
Scenario 1: In this scenario, the price could continue its upward trajectory and retest the 140.943 level. If this test proves successful, we can anticipate further upward movement to test the 141.130 levels. Additionally, there is potential momentum building up at the 141.546 level, and if these levels are tested, it may propel the price even higher towards the 141.708 level. It is important to monitor the market closely as it approaches the key resistance levels at 141.938 and 142.127, as these levels could potentially hinder the bullish momentum.
Scenario 2: Alternatively, the price could reverse and head lower to test the 140.312 level. If the test at this level proves successful, it may lead to further downward movement towards the 140.102 levels. A crucial level to monitor in this scenario is the 139.939 level, as a test of this level could indicate a potential continuation of the downward trend, possibly testing the 139.821 level. The price action around this level will be critical in determining the next move for the market.
Earlier today the Bank of Japan maintained its accommodative monetary policy with a -0.10% interest rate, aiming to support the economy. Be cautious of the markets movements.
Currently, the momentum for the market is upward, indicating a positive bias. However, the Relative Strength Index (RSI) is in an undecided range, suggesting caution should be exercised. It is possible that the market may range between the 139.821 and 141.540 levels. Traders should closely observe how the price reacts around these levels to gain further insights into the market’s direction.