USD/JPY Forecast – US Dollar Continues to Find Buyers

US Dollar vs Japanese Yen Technical Analysis

The U.S. dollar has initially fallen rather hard against the Japanese yen, but it certainly looks at this point as if we are going to continue to see more of a buy on the dip mentality here as the market participants continue to play the interest rate differential.

Yes, Jerome Powell said during the Thursday session that we are more likely than not still going to see three rate cuts coming out of the US, but that still means that this will ultimately have a positive swap even after all of that. With that being the case, I like the idea of jumping in on dips and taking advantage of it when they occur.

Ultimately, this is a market that will remain very noisy, but that’s nothing new as it is typically one of the wilder moving majors. So with this, I think we are getting awfully close to breaking out to a fresh new high, and that should bring in more FOMO trading as people want to chase that momentum.

I believe that the pair is eventually going to go looking toward the 153 yen level and it is only a matter of time before the 152 yen level gets broken through and we go much higher. At that point in time, I would anticipate a lot of “FOMO trading”, where people will pile in to try to chase the trade. This is something that unfortunately will probably cause a bit of a “melt up”, and wipe out those who continue to short this market based on the idea that it’s “gone too far” at this point in time.

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