USD/JPY Price Forecast – US dollar breaks downThe US dollar broke down a bit during the trading session on Thursday as we continue to ponder the idea of a softer Federal Reserve when it comes to interest rates. If that is going to continue to be the case, then it makes sense that we will continue to drive towards the ¥108 level.
The US dollar has broken down a bit against the Japanese yen during trading on Thursday, as we continue to see a bit of US dollar softens. Beyond that, there are a lot of geopolitical and economic concerns around the world, and that generally is good for the Japanese yen anyway. We had recently attacked the ¥110 level, formed a couple of shooting stars, and now have seen the market drive its way much lower as exhaustion overtook the market. With the Federal Reserve sounding a bit softer these days, it makes sense that the move accelerated after Jerome Powell gave his press conference.
USD/JPY Video 01.02.19
The ¥108 level is an area that has been supportive in the past, so it makes sense that perhaps we would test that area again. Ultimately, if we can break down below the ¥108 level, then I think the market probably goes looking towards the ¥107 level, maybe even ¥105 after that. This isn’t to say that it’s going to be easy, but I do think that perhaps longer term that’s where we go due to the deteriorating economic situation around the world, and of course the massive bearish pressure that we have seen as of late. The Japanese yen will continue to be one of the favorite ways for currency traders to find safety when things become a bit difficult. Rallies at this point continue to be selling opportunities on signs of exhaustion.