Dollar-yen reaches six-month highsUS Dollar/Japanese YenFX:USDJPYMichael_Stark_ExnessPolitical developments in Japan, primarily Sanae Takaichi winning leadership of the ruling Liberal Democratic Party, have driven the yen down recently while giving tailwinds to the Nikkei 225. Ms Takaichi’s victory suggests ongoing loose fiscal and possibly monetary policy. Meanwhile the Bank of Japan’s expected hike to 0.75% at the end of October seems less certain after very disappointing average cash earnings for August released late on 7 October. The price has clearly broken above ¥150 for now; that area had seemed to be a possibly important resistance for much of the summer. The 61.8% weekly Fibonacci retracement could be the next significant resistance. ¥154, the high from February, might also cap gains. Since the moving averages are bunched fairly close together considerably lower and there’s currently clear, strong signals of buying saturation, consolidation might seem more likely than continuation in the near future. Now that the area around ¥150-151 has been broken, it might flip to being a support, especially considering the presence of the 50% weekly Fibonacci retracement in this zone. Given the size of the weekend’s gap from 3 October and the subsequent strong follow-through, it’d be less likely to see a relatively large retracement below ¥149, but upcoming American inflation might give more clarity on the next direction. This is my personal opinion, not the opinion of Exness. This is not a recommendation to trade.