US Dollar Pulls Back Slightly

US Dollar vs Japanese Yen Technical Analysis

The US dollar has fallen a bit during the trading session on Thursday, as we have stretched a bit too far. At this point, the market looks as if it is testing the ¥125 level for support, but more likely than not we will probably get a little bit more of a deeper dip than that. The ¥122.50 level is also a more supportive area, so that would be an area that I would look towards down the road. The 50 Day EMA is currently crossing the ¥120 level, and therefore it is going to make a lot of sense that the market would also look at that as a major support level as well.

Keep in mind that the highs from the trading session on Wednesday were testing a major monthly resistance barrier, so it makes sense that we would get a pullback. If we were to break above there, it would have us entering a whole new phase of the market, one in which we would be more “buy-and-hold” from a longer-term standpoint. Looking at this chart, we are quite parabolic, and that typically causes some type of big correction. Having said that, the Bank of Japan continues to be aggressive in fighting interest rates, thereby essentially “printing yen.” That of course works against the yen in the currency markets, as you have seen against multiple other currencies as well.

I believe at this point we are looking at a potential “buy on the dip” type of situation, but we need to dip to appear. Looking at this chart, I think it remains bullish, and in order to get negative at all we would need to see this market break down below the ¥120 level.

USD/JPY Price Forecast Video 15.04.22

For a look at all of today’s economic events, check out our economic calendar.