USD/JPY Forecast – US Dollar Pressing the ¥150 Level Again

USD/JPY Forecast Video for 23.10.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has rallied significantly during the course of the trading session on Friday, as we continue to threaten the ¥150 level. This is an area that has been important more than once, and has obviously been a bit of a brick wall. If we can break above there, then the market is likely to open up and move to the ¥152 level, and in the interim you can even get paid due to swap. In other words, there’s no real reason to short this market, it is probably only a matter of time before we do break out. Keep in mind that the Bank of Japan is still involved in quantitative easing, recently stepping directly into the bond market in order to buy bonds and keep the rates down.

On the other side of the equation, you have the Federal Reserve which of course is still tight with its monetary policy, and very unlikely to change anytime soon. While most traders do not expect an increase in rates at the next meeting, the reality is that by the end of the year, the Federal Reserve very well could raise rates again. Regardless, they are likely to keep rates tight for quite some time, so that does make the US dollar much more attractive than the Japanese yen.

Short-term pullbacks continue to find plenty of buyers, and the ¥147.80 level underneath is the “floor in the market” at the moment. The 50-Day EMA is also racing toward that area, so it offers a significant amount of support as well. Short-term pullbacks offer value, and therefore traders will continue to look at it as an opportunity. As things stand right now, it’s almost impossible to go short of this market, despite the fact that the Bank of Japan continues to jawbone on the market. Central bank intervention has happened recently, but it’s happened in both directions, showing that the Japanese are in a position where there is an awful lot that they can do. With this, I do think eventually we break out, and when we do there will be a huge run to the upside.

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