USD/JPY Forecast – US Dollar Continues to Look Supported Against The Yen

USD/JPY Forecast Video for 26-01-2024

US Dollar vs Japanese Yen Technical Analysis

The dollar has rallied slightly during the trading session on Thursday against the Japanese yen as the 147.33 yen level has offered support. Ultimately, this is a market that I think continues to see a lot of noisy behavior and that every time we start to sell off, it is a buying opportunity.

The 50 day EMA underneath, right around the 146.20 yen level, is a support level that I think a lot of people will pay close attention to. All things being equal, I think this is a situation where we will continue to see a lot of back and forth and noisy behavior, but right now, we just don’t have momentum and that, of course, is more likely than not going to be a major issue.

I do favor the upside and I don’t think that we are anywhere near trying to turn the market around and the interest rate differential of course is going to continue to cause a lot of upward pressure. Above I see the 149.80 level as a significant resistance barrier and if we can break above there, the 152 yen level would be your next target.

If we were to break down below the 145 yen level, I wonder how long it would actually have any type of follow through as the 200 day EMA is just a bit below there. In general, the Bank of Japan had a chance last week to shake the markets up and suggest that they were going to do something about monetary policy and yet they chose not to. So, with that, it’s obvious that the yen is going to continue to be weak.

Whether or not the Federal Reserve will cut soon is still a bit of an open question, although there are cuts expected later this year. When you look at this chart, you should also think of it as a secondary chart or perhaps even an indicator of how to trade other yen-related pairs. For example, you may look at this and use it as information on how to trade the Australian dollar against the yen or the Canadian dollar against the yen, etcetera. All things being equal, I am still a buyer of dips.

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