USD/JPY Forecast – US Dollar Continues to Threaten the Same Area

USD/JPY Forecast Video for 26.10.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar pulled back ever so slightly early on Wednesday, as we continue to see a lot of noise near the ¥150 level. The ¥150 level is an area that has been important for quite some time, and if we can break above there, it’s likely that the market will go looking to the ¥152 level. The ¥152 level is an area that has seen quite a bit of significant resistance previously, and if we can break above there, the market can really start to take off to the upside.

At this point, it’s probably worth noting that the Bank of Japan is doing everything it can to keep the interest rates in that country down, and has even stepped into the bond market directly recently. Short-term pullbacks continue to attract buyers due to the fact that the Federal Reserve keeps interest rates higher. In fact, you continue to see traders get paid to hang on to this market.

The ¥147.80 level underneath offers significant support, and we now have the 50-Day EMA in that same area. This of course makes quite a bit of sense that we would see that as a short-term “floor in the market” that a lot of people will be paying close attention to. With this being the case, I think you get a situation where the market has to look at this through the prism of whether or not we can hang onto it. As long as we do, then I think it’s probably a situation where buyers come in and take out the highs above.

We have the Bank of Japan out there messing about and lurking in the shadows, so it does have certain traders concerned. They have already intervened, these people believe that’s the case, and therefore they have stopped the market at this point. However, it’s obvious to me that the market continues to favor the upside. Expect a lot of volatility and choppiness, but eventually we will break out to the upside. Ultimately, I think you will have to be patient, but eventually the buyers will take over.

For a look at all of today’s economic events, check out our economic calendar.