USD/JPY Forecast – US Dollar Reaches the 50-Day EMA Again

USD/JPY Forecast Video for 14.02.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has rallied a bit during the trading session on Monday, as we have broken above the ¥132.50 level, and are now threatening the 50-Day EMA. Ultimately, this is a market that I think is going to continue to see plenty of bullish pressure, due to the fact that the Bank of Japan continues to have to fight interest rates rising, and therefore has to continue to print yen in a situation where the limit they are willing to accept on the 10 year yield is 50 basis points. In other words, if the market were to see higher interest rates again, then it’s very likely that we’ve got a situation where more yen will be printed, and it will continue to drive down the value of that currency.

That being said, every time interest rates drop a bit, that does help the yen and therefore could drive down the value of the market. Ultimately, this is about interest-rate differential and what’s going on with central banks around the world.

Looking at the chart, if we can clear the 50-Day EMA, then it’s likely that we would go looking to the 200-Day EMA, sitting near the ¥134.50 level. After that, we have a bit of a barrier at ¥135, but by the time we get there, I would suggest that the trend has gone back to being positive for the longer term. The market pulling back will probably see plenty of support near the ¥131.50 level, and then again at the ¥130 level. Whether or not we turn things around remains to be seen, but it certainly looks as if we could be threatening that move.

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