The US dollar showed significant strength against the Japanese yen in the past week. A hammer formation in the previous week’s candlestick suggests a continuation of this trend. Despite intervention by the Bank of Japan, it seems they may be struggling to balance their loose monetary policy with a strong currency. As a result, the market is overpowering them, and it is likely that the USD/JPY pair will continue to rise towards the ¥160 level.
Any short-term pullbacks are likely to attract buyers, particularly around the ¥155 level, with potential support at ¥152. It is advisable to stay bullish on this pair, as holding onto the position results in daily swap payments and price appreciation. Selling is not recommended unless the pair breaks below ¥150, and even then, it is important to consider the fundamentals.
Overall, the USD/JPY pair is a steady performer that rewards investors with daily swap payments and potential price appreciation. It is wise to maintain a long position and monitor economic events through the economic calendar.