USD/JPY Forecast – US Dollar Pulled Back Slightly

USD/JPY Forecast Video for 10.10.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has pulled back just a bit during the trading session on Monday, as we continue to see a lot of back and forth. The market is currently trading in a rather tight range, and therefore you could look out the ¥147.80 level as a support area that’s worth paying close attention to, but at the same time you can say that the ¥150 level is massive resistance. I suspect that we probably need to pay close attention to the ¥150 level, because the last time we got there, we sold the market dump rather drastically.

If we can clear the ¥150 level, especially on a daily close, it could send this market screaming higher, perhaps working its way to the ¥152 level. The ¥152 level was a major resistance barrier that the market pulled back from previously, so I think it does make a juicy target for those who are bullish. Furthermore, you have to look at the interest rate differential as a major driver of where this market goes next, perhaps making it a market that will be bullish over the long term, regardless of what we see. Rates are nowhere near rising in the United States, and of course the Bank of Japan has no real way to raise rates in the country that is so heavily indebted. Quite frankly, the Japanese cannot afford it.

Every time this market pulls back, I look at it as a potential buying opportunity; it looks like we may be getting one of those early on Monday. Nonetheless, I think that ultimately this is a market that will show itself as being positive regardless of what happens next, and therefore it’s likely that you have a built-in amount of bullish pressure that will be a major factor here. I have no interest in shorting this market anytime soon, so therefore I am looking for some type of opportunity here to take advantage of “cheap US dollars”, as it would take a huge shift fundamentally for this market to turn around and become anything remotely close to being a bearish market. Quite frankly, as long as the bond markets are doing what they are doing, there’s no scenario where I see a significant pullback.

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