• The US dollar initially did try to recover against the Japanese yen during the trading session on Monday, but a lower than anticipated manufacturing PMI number may have been a bit of a problem.
• While that has seen the US dollar rocket higher against other currencies, I think this is more or less a situation where traders are starting to focus on whether or not the Federal will cut rates in December, and that has a major influence on this pair.

In general, this is a situation where traders continue to see concerns about the interest rate differential narrowing. Now, the bond market had a lot to say about that recently, but it looks like the bond market's giving that up a little bit. As we are below the 150 yen level, now I think things are getting really interesting.

Is the Selling Done?

Whether or not we are done selling off remains to be seen, but you can still make an argument for an uptrend. This most recent swing high though, that could be an ominous sign. I suspect at this point, you're probably better off waiting for some type of bounce to get involved. It just has the feel of a falling knife type of situation.

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That doesn't mean that the US dollar itself is going to do poorly, and I just think that in the realm of safety bid, US dollar is right up there, but it's not the Japanese yen. If we can turn around and recapture the 50-day EMA close to the 151.33 yen level, then I think you start to look in the other direction again. I'm not necessarily looking to short this USD/JPY pair, I guess what I'm saying is, I'm just not looking to get long of it at this point in time, although over the longer-term, I will be looking to take advantage of the interest rate swap at the end of each day.

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