USD/JPY Price Forecast – Dollar Falls Hard Against Yen

The US dollar has fallen rather hard against the Japanese yen during the trading session on Friday in reaction to news that the United States had killed a top Iranian general in an airstrike that occurred at the Baghdad airport. Ultimately, this has traders around the world looking for safety, and the Japanese yen of course is the “safety currency” out there. The Iranians have found retaliation, but at the end of the day traders will have to decide whether or not any type of significant retaliation is likely. After all, the Iranians have made a few strikes on airfields in Saudi Arabia, and of course backed the mob that attacked the US Embassy in Baghdad, but the United States is clearly escalated this. The question now is whether or not the Iranians will try to react in a significant way.

USD/JPY Video 06.01.20

At this point, the easiest way to trade this market is to see whether or not we can recover from the fall on Friday. If the market wipes out the candlestick from the Friday session, then it’s very likely that market participants will continue to chase this pair back towards the highs again. While this was a very ugly trading session, the reality is that the reaction was somewhat muted in comparison to what it could have been. It is because of this that I believe that a rally could happen, but I need to see the Friday candlestick taken out to the upside in order to start buying again. The Monday open could be rather interesting.

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