• As you can see, it's been very noisy during the trading session here on Tuesday as the 155 yen level continues to be supported right along with the 50-day EMA. Ultimately, this is a market that I think you have to look at through the prism of whether or not it is ready to go higher and pay attention to the interest rate differential as well.
• The biggest problem with this pair right now is the fact that the Bank of Japan continues to be the focus of traders, as Friday is its next interest rate decision. While I don't necessarily think that they are going to close the gap that far between the United States and Japan, the reality is that the Japanese could very well tighten monetary policy a little bit.

On a Move Lower

If the market were to break down below the 50 day EMA, then we could see this market go looking to the 153 yen level. On the other hand, if we can break above the 156.50 yen level, then it opens up a move to the 158 yen level. I suspect that in the next couple of days will probably be a lot more of this chop that we are looking at right now.

Furthermore, we have a lot of questions about the US dollar in general because Trump is on the warpath already talking about tariffs on Mexico and Canada, and while that doesn't directly affect Japan, it does directly affect the US dollar. So, expect more noise and more chaos, but really, once we get through this week, we should have a little bit more in the way of confirmation. All things being equal, this is a market that isn't in an uptrend. I do prefer the upside for no other reason than getting paid at the end of every day.

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