USD/JPY Forecast – US Dollar Continues to Stabilize Against Yen

USD/JPY Forecast Video for 13.12.22

US Dollar vs Japanese Yen Technical Analysis

The US dollar has rallied a bit during the trading session on Monday, showing signs of life again. Ultimately, this is a market that I think is trying to figure out what to do with the 200-Day EMA underneath, which of course typically attracts a bit of support. With that being the case, I anticipate that you got the opportunity of the market breaking above the ¥137.50 level, and perhaps returning to the ¥140 level. That’s not necessarily going to be the easiest thing, but it is worth noting that we have stabilized after touching the 200-Day EMA.

One of the major drivers of this pair is more likely than not going to be the Federal Reserve meeting later this week, with the statement coming out on Wednesday. If the market can become convinced of the bullishness, then it’s likely that we may have just seen the bottom. If the Federal Reserve sounds hawkish enough, that almost certainly will send this pair higher.

However, if they sound like they are starting to shift attitudes, it’s very possible that we may plunge lower. If we break down to a fresh, new low, then we are starting to look at a potential long-term trend change. This is all going to come down to interest rates and how much printing of Japanese yen the Bank of Japan will have to do. As long as they are fighting interest rates rising, it is going to put a certain amount of pressure on the Japanese yen. This will be especially true if global rates were to turn around and rally. This has been a very significant pullback, but it’s probably worth noting that the yen is still down about 13% for the year.

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