Introduction
The U.S. Dollar and the Japanese Yen in the Forex
Although the foreign exchange market is packed by multitudes of currencies from many different countries, the reality is that only a few of them stand out to be worthwhile trading currencies for traders.
Foremost examples of these profitable currencies are the U.S. dollar and the Japanese Yen. These two dominant currencies in the forex have always been a staple among traders as they have showed resilient stability and profitability through the years.
This does not mean that the dollar and the yen has always been sailing easily in the treacherous waters of the forex world however as the two currencies both have experiences of decline on their part particularly in the closing years of the 20th century.
The U.S. dollar was the most formidable currency in the world especially after the end of Second World War when the economy of the United States was second to none in the world.
Well, everything changes and this prominence of the U.S. dollar in the forex market is no exception. Many currencies have rivaled the dollar ever since and as mentioned earlier, the dollar has seen a steady decline particularly before the start of the 21st century.
The Japanese yen is in no better shape either. Like the dollar, the yen has lost steam considerably, considering the fact that it was one of the most bullish currencies in the world of the forex, second only to the dollar back when the economy of Japan was still then growing into the economic power that we know.
One of the major reasons for this decline of the two in foreign exchange is the lightning-fast rise of the euro in the world currency market. Since its inception, the euro has pushed the two out of the top spot to become the new currency to beat in the forex, no thanks to the powerhouse currencies it was made of.
This entry of the euro into the fray did not bode well for both the dollar and the yen as both has since been unable to reclaim their former glories.
Nonetheless, both of these two major currencies still enjoy the prestige of being one of the top currencies in the foreign exchange despite not being the dominant currency they once was. The yen and the dollar are still profitable though as they still possess the stability which makes a currency worthwhile to trade.
Things change and this much is true in the forex where the dominant currencies come and go. Knowing these changes and the reasons that caused them will help traders in forecasting the future behavior of the current situation in the forex market which can yield profit if it will be accurate.