USD/JPY Forecast – US Dollar Bounces From the 200-Day EMA Again

USD/JPY Forecast Video for 16.12.22

US Dollar vs Japanese Yen Technical Analysis

The US dollar has bounced a bit during the trading session on Thursday, breaking the top of the hammer from the previous session. At this point, it looks like the 200-Day EMA can continue to offer a bit of support, especially as it is hanging around the ¥135 level. At this point, it looks as if the ¥138 level being broken to the upside will allow much bigger move to the upside, perhaps to the ¥140 level. Ultimately, this is a market that I think given enough time will not only reset level, but continue to go higher, especially if interest rates start to rise again.

Now that we are past the Federal Reserve meeting, it should be noted that Jerome Powell is relatively hawkish still, therefore it’s likely that we would see the US dollar recover given enough time. Pay attention the interest rates in the United States because the ones in Japan are not moving. This is because the Bank of Japan is doing everything they can to keep interest rates down, so therefore they are printing Japanese Yen. Ultimately, this is a market that I think we are trying to figure out whether or not we are going to have to build up a little bit of a base.

Having said that, if we were to break down below the lows from the previous week, then it’s likely that we could go down to the ¥132.50 level, possibly down to the ¥130 level. That obviously would be a bearish US dollar situation, as well as the pressure on the Bank of Japan easing up.

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