USD/JPY Forecast – US Dollar Rallies Against The Japanese Yen

USD/JPY Forecast Video for 04-01-2024

US Dollar vs Japanese Yen Technical Analysis

The US dollar initially rallied a bit during the Wednesday session against the Japanese Yen as it looks like we are trying to form some type of basing pattern. It’s worth noting that the uptrend line underneath continues to hold and the 141 Yen level seems to be a bit of a barrier. I anticipate that the 200 day EMA above could be a little bit of a barrier as well so the upside might be somewhat limited in the short term, but longer term whether or not we break above there probably comes down to the bond market more than anything else so with that we need to pay close attention to the 10 year yield as it has such a huge influence on this pair.

Breaking above the 10 year yield opens up the possibility of a move to the 145 yen level which would be the next barrier, and where the E-50 day EMA is currently trying to get to. Clearing all of that would mean that the market is ready to rip higher again in the longer term buy and hold type of scenario. Either way, I think this is a pair that is probably going to be very noisy, but that’s nothing new for this market. And you have to keep in mind that the jobs number on Friday is certainly going to have its influence as well. The USD/JPY pair tends to be very noisy during that announcement and shortly afterwards.

So, I think it does set up for a certain amount of volatility. You’re going to have to be able to ride through a lot of noise to collect profit. If we turn around and break down below the 141 yen level, maybe even the 140 yen level, then this pair falls apart and we probably end up down to the 135 yen level quicker than most people anticipate as things stand right now though, it looks like we are trying to hold support from a longer term perspective.

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