USD/JPY Price Forecast – The US Dollar Bounces

US Dollar vs Japanese Yen Technical Analysis

The US dollar has rallied a bit during the trading session on Tuesday as we continue to see the US dollar rally overall against the yen. Remember, the Bank of Japan is essentially doing quantitative easing, which is a bit of an outlier to the rest of the central banks around the world. The majority of major central banks are in the process of tightening, and therefore the Japanese yen has been pounded. Furthermore, you need to keep in mind that the Federal Reserve is one of the most hawkish central banks, and therefore it makes quite a bit of sense that this pair continues to find buyers.

You can make an argument that we are just now breaking out of a bullish pennant, which signifies that we may be entering a “buy-and-hold” period. If that’s the case, we have a long way to go, and traders will continue to see this as an opportunity. The US dollar is by far the strongest currency out there, although we have seen a rather significant pullback. This was more or less from an overbought condition, so it all lined up quite nicely.

It’s worth noting that the parent does tend to be choppy at times, but also has explosive moves. It’s also worth noting that it sometimes gets influenced by risk appetite, but at this point, I believe that the trade is moving more or less due to central-bank action more than anything else. With this being said, if you take a “measured move” of the potential breakout, we could be talking about going all the way up to the ¥140 level eventually.

USD/JPY Price Forecast Video 01.06.22

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