Current Status of the Japanese Yen to US Dollar Exchange Rate and the Impact of Middle East Situations
Last weekend, cautious sentiments about the Middle East situation intensified, leading to strengthening of US dollar selling and Japanese yen buying, which caused the Japanese yen to reach 153.59 against the US dollar. Subsequently, as tensions in the Middle East eased, this downturn was reversed and the yen to dollar rate continued to operate at high levels in foreign markets.
The situation in the Middle East remains highly tense, but both Israel and Iran are cautious about escalating conflicts. Furthermore, with the important Jewish festival of Passover (Pesach) starting today in Israel, the situation may temporarily calm down. How this will affect the Japanese yen to US dollar exchange rate deserves close attention.
Exchange Rate Outlook and Strategy
Centered around the 154 yen level, the market trend aims to break through the pivotal point of 155 yen. A temporary sharp drop occurred last weekend, but closing US dollar buys made it easier for the yen to dollar rate to test the upward space.
Sales related to option trading can be seen around 155 yen, so if the price surpasses this level, stop-loss orders are likely to be triggered. If this level is broken, the yen to dollar rate is expected to rise rapidly.
However, there is cautious sentiment in the rising process. After discussions with the United States and South Korea during the G20 period, the timing for intervention has matured. Market intervention might occur if prices suddenly rise, which could lead to a 5-yen decrease in the yen to dollar rate. Thus, the upward trend may proceed cautiously.
Trends in Euro/US Dollar and Euro/Japanese Yen
The euro to US dollar exchange rate is expected to maintain around the 1.06 level, with steady fluctuations near 1.0600. A cautious attitude towards downward pressure can be observed against the backdrop of a strengthening US dollar.
The euro and yen are likely to follow the trends of the US dollar and Japanese yen. During tense times in the Middle East, selling pressure may be stronger against the dollar/yen, but if dollar/yen tests the 155 yen level, the euro/yen is also expected to see a steady trend.
As mentioned above, changes in the Middle East situation are having a significant impact on the foreign exchange market, and investors must continuously monitor these geopolitical risks and manage risk accordingly.
