The US dollar broke down rather significantly during the trading session on Friday, and what would have been a bit of a “risk off move.” Ultimately, the market breaking below the ¥109 level is a very ugly sign, as it shows that risk appetite is starting to fall apart. We remember, the Japanese yen of course is very “safe” when it comes to trading.
The ¥109 level had been important more than once, and now that we are below there it’s very likely that we could go down to the ¥108 level. In fact, we aren’t that far from doing that again. If we did break down below the ¥108 level, this opens up the door to much lower levels, possibly the ¥105 level. It’s very likely that the market breaking down below there would be catastrophic for not only this pair, but also the markets as far as risk appetite is concerned overall.
To the upside, the ¥109 level should now offer resistance. Any type of exhaustive candle could be an opportunity to start selling, and it’s very likely that a lot of selling pressure is waiting just above that area. In fact, it’s not really safe to buy this pair until we break above the ¥109.70 level, something that looks very unlikely to happen after this massive bar that had formed for the Friday session. Ultimately, the market looks like it’s being threatened to the downside, and if we break down below there it’s likely that this will be due to some type of financial meltdown. Markets are most certainly precarious right now overall, and with the US/China trade situation being so dicey, it’s likely that we will continue to see a lot of fear coming to the marketplace. However, we’ve seen previously that a strong and positive statement from either United States or China can turn things right back around. Be very cautious but certainly it looks negative now.
The ¥109 level had been important more than once, and now that we are below there it’s very likely that we could go down to the ¥108 level. In fact, we aren’t that far from doing that again. If we did break down below the ¥108 level, this opens up the door to much lower levels, possibly the ¥105 level. It’s very likely that the market breaking down below there would be catastrophic for not only this pair, but also the markets as far as risk appetite is concerned overall.
To the upside, the ¥109 level should now offer resistance. Any type of exhaustive candle could be an opportunity to start selling, and it’s very likely that a lot of selling pressure is waiting just above that area. In fact, it’s not really safe to buy this pair until we break above the ¥109.70 level, something that looks very unlikely to happen after this massive bar that had formed for the Friday session. Ultimately, the market looks like it’s being threatened to the downside, and if we break down below there it’s likely that this will be due to some type of financial meltdown. Markets are most certainly precarious right now overall, and with the US/China trade situation being so dicey, it’s likely that we will continue to see a lot of fear coming to the marketplace. However, we’ve seen previously that a strong and positive statement from either United States or China can turn things right back around. Be very cautious but certainly it looks negative now.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.