US Dollar Continues to Work Its Way Higher for the Week

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has rallied significantly during the course of the week, testing the top of a major shooting star from the previous week. At this point, the market is likely to continue to see a lot of resistance in the form of the ¥125 level, which is an area that which a lot of people would be resistant. After all, the ¥125 level is an area that has been resistant previously, and therefore it makes a certain amount of sense that we may struggle to break out. That being said, if we get at least a daily close above the ¥125 level, that would be explosively bullish.

The Bank of Japan continues to step into the bond markets, essentially “printing yen.” That will continue to drive the Japanese yen lower in value, so at this point, we are on the precipice of a rather strong breakout. The alternate scenario would be a breakdown below the previous candlestick, opening up a drop. Ultimately, the market will have to come to grips with the idea of whether we need to consolidate before either breaking out or if we need to pull back.

I believe that the next couple of weeks will be crucial, and if we break out to the upside, it is possible that the pair goes to reach the ¥127.50 level. If the ¥125 level holds over the long term, that would be a major shorting opportunity, but at this point, I would not want to try to step in front of this type of move. With this, it is more likely than not better off to wait for a daily candlestick to give us a clue as to where we are going later, using the weekly charts as a guide.

USD/JPY Price Forecast Video 11.04.22

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