USD/JPY Price Forecast – The US Dollar Continues to Bounce Against Japanese YenThe US dollar bounced against the Japanese yen during the trading session on Wednesday, as the ¥110 level continues to be crucial for the longer term.
The US dollar has rallied a bit during the trading session on Wednesday, as the ¥110 level is crucial for the longer-term trading ranges, as the market continues to bounce around between the ¥105 level on the bottom, and the ¥115 level on the top. In other words, the ¥110 level is essentially what the “fair value” of this pair should be. Ultimately, this is a market that is all over the place but keep in mind that the coronavirus continues to cause issues.
USD/JPY Video 27.02.20
The Japanese economy is presently looking at a recession, and as a result it continues to punish the Japanese yen itself. Ultimately, this is a market that continues to see noisy conditions, but I do think that overall the US dollar continues to attract a lot of attention. Furthermore, the stock markets in America have been a bit oversold and this could mirror what happens next. If that’s going to be the case, then it’s very likely that the market continues to see upward pressure, but definitely in a significantly erratic fashion. That being said, if we were to break down below the ¥109.50 level it would completely change the attitude of the market and could send this pair much lower. At that point I would anticipate that the market probably goes looking towards the 200 day EMA underneath.
All that being said, this looks to me a lot like a market that has broken out, rallied significantly, came back to test that previous resistance, and now is trying to bounce again. In other words, it’s classic technical analysis as far as breakouts are concerned.