USD/JPY Forecast – US Dollar Continues to Pressure Resistance

USD/JPY Forecast Video for 19.09.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has done very little during the trading session against the Japanese yen, which makes a certain amount of sense considering that it was a banking holiday in Japan, and of course at the same time we are waiting on the FOMC meeting on Wednesday and recognize that the market could see a lot of volatility over the next couple of days. At this point, I think a little bit of a short-term pullback certainly makes a little bit of sense, but really at this point the market continues to pay close attention to the ¥147.80 level above, which is a significant barrier.

If we do breakout above that area, it opens up the possibility of a move to the ¥150 level. The ¥150 level course will attract a lot of attention from a psychology standpoint, but we have already seen that area sliced through once before, so it may not be as big of a deal.

All things being equal, I think this is a market that you continue to buy on dips, but we have yet to get one over the last couple of days. I think at this point, we will eventually take advantage of cheap US dollars, especially as the Bank of Japan is very unlikely to change its monetary policy. Sure, they will almost certainly try to jawbone the market when it comes to the value of the yen, so we may get a little bit of a nasty pullback, especially on Friday when the Bank of Japan has something to say.

Regardless, they are light years away from being anywhere near as tight as the Federal Reserve, and I would look at pullbacks at this point as potential value plays that people could pay attention to. Ultimately, this is a very noisy area, and I do think that eventually will break out, mainly due to the fact that the market has been very resilient on the attempted breakout. The 50-Day EMA underneath is closer to the ¥145 level, which I think is a short-term “floor in the market” at the moment. That being said, Monday and Tuesday could be a bit quiet as we wait for Jerome Powell.

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