USD/JPY Forecast – US Dollar Breaks Out to The Upside

USD/JPY Forecast Video for 16.06.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has rallied rather significantly during the trading session on Thursday, as we broke well above the ¥140 level. The Federal Reserve being more hawkish than anticipated on Wednesday had a lot to do with this, but we have at the same time the ECB come out and sell just as hawkish, and it’s that little bit of a knock on effect against the US dollar. At the end of the day, this pair is more or less about the Japanese yen anyway, so I do think that the midday pullback is going to be a nice opportunity to get long.

If we break above the top of the candlestick for the trading session on Thursday, that would be extraordinarily bullish, and it would send the US dollar much higher against the Japanese yen. Over the longer term, I do think that it is only a matter of time before that happens, as we have just broken out of a major bullish plan, which of course is a very obvious signal sign.

If we do break above this level, the “measured move” is for the ¥148 level being targeted. Underneath, we have the ¥138 level as massive support as it was the top of the previous ascending triangle. Furthermore, we also have the 50-Day EMA racing toward that area, so I think that gives us yet another support level. Ultimately, I think this is a situation where we will eventually see the buyers return, assuming that we could even get that low. I do think that we are looking at a nice buying opportunity for the US dollar against the Japanese yen, although the Bank of Japan does have a meeting on Friday and there could be a little bit of noise around that.

The Japanese have already suggested that they are going to continue being very loose with their monetary policy, so I would not expect some type of major correction over the longer term. At this point, it looks as if it is offering “cheap US dollars”, something that I am more than willing to take advantage of. I have no interest in trying to buy the Japanese yen anytime soon.

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