Opportunity with Yen Consolidation
The Bank of Japan will issue their Monetary Policy Statement tomorrow and no major changes are expected. The Yen has been range trading mid-term, but has weakened early this morning against the U.S Dollar and may provide an opportunity for traders to take advantage of its consolidation.
Bank of Japan Tomorrow
The Yen has traded in a weaker manner early this morning and has gone above the 113.00 level against the U.S Dollar.
The Yen continues to show momentary changes in direction which essentially lead to a consolidated path. Tomorrow the Bank of Japan will issue its Monetary Policy Statement.
Patience an Advantage for Yen Traders
However, the Bank of Japan will likely offer very little in the way of change. The economy of Japan has shown signs of improvement since this summer, and the Nikkei Index has made an impressive run upwards with its equities.
Critical resistance for the Yen is around the 114.00 level and support is near the 112.50 juncture. Traders who have patience may be able to take advantage of the range which has been consistently tested mid-term.
Additional Yen Weakness a Possibility
Forex trading globally will begin to see much lighter volumes as Christmas draws closer. Sudden changes in direction are commonplace during the holiday season.
Because of the relative strength in the Nikkei Index, we believe the Yen may have experienced more weakness and test resistance if the U.S Dollar is bought against the Japanese currency.
In the short term, we believe the Yen may be negative. In the mid-term and long-term, we are unbiased.
Yaron Mazor is a senior analyst at SuperTraderTV.
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This article was originally posted on FX Empire