USD/JPY Forecast – US Dollar Gives Up Early Gains Against Yen

USD/JPY Forecast Video for 31.08.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has found itself to be on the back foot during the trading session on Wednesday, as we continue to see weak economic numbers coming out of the United States. This has traders out there thinking that perhaps the Federal Reserve is going to continue to see enough negativity to perhaps change its tune. That being said, we have a couple of economic indicators over the next couple of days that will cause some headaches. The Core PCE Index is coming out on Thursday, which of course is a major indicator that Federal Reserve participants pay close attention to. After that, we have the big one, the Non-Farm Payroll announcement coming out on Friday.

Recently, it seems like the US economy is coming down, so everybody’s getting excited about the possibility of cheap money coming. That obviously works against the value of the US dollar, but to say that it is a done deal is probably a bit of a stretch at this point. After all, this wouldn’t exactly be the first time that the market tried to push the Federal Reserve into doing something that it just simply isn’t interested in doing. The jobs number is expected to come out at 169,000 on Friday, and I suspect that by the time we get through the Non-Farm Payroll number, we will have finally seen enough numbers to either start selling the US dollar, or cause even more chaos.

It’s also probably worth noting that we are currently at the very end of the summer, and therefore liquidity is probably a bit of an issue. With that being the case, I would anticipate a lot of choppiness, and perhaps back-and-forth action in not only the US dollar/Japanese Yen currency pair, but markets in general. Ultimately, be cautious about getting overly exposed, but when you look at this chart, it’s obvious that we are in an uptrend. That doesn’t mean we can’t take a bit of a pause, but overall it still looks bullish at this point in time. It’s not until we break down below the ¥142.50 level that I would be completely convinced that we break down longer-term.

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