The Dollar is advancing versus most of its major counterparts as the housing market shows a significant rebound. The US economy is very dependent on the housing market, because other sectors also rely on the rate of new constructions. For now it seems like the US economy is heading in the right direction and growth could keep steady. Therefore, for some investors and analysts the Federal Reserve may be getting ready to raise its interest rates.

Higher interest rates in the United States mean that the demand for Dollars could rise and that is why we are seeing the greenback gaining a lot of ground. On the Daily chart above of the USD/JPY, courtesy of the Forex Broker ActivTrades http://www.activtrades.co.uk/, we can see that the pair is trying to visit the 103.00 round number level again. We can also see that in the not too distant past, the price consolidated around that zone for three days and then it came back down to the 102.00 level.

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The real range of the USD/JPY has been between the 101.00 as support and the 103.00 as resistance; with the 102.00 as the median. Therefore, another visit to the 103.00 level could stop the price there and make it go back to the median price around the 102.00 level.

Alexander Londono – Analyst Contributor at ActivTrades.

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