USD/JPY Price Forecast – US dollar breaks down against Japanese yen in risk off move

The US dollar broke down significantly during the trading session on Tuesday, breaking towards the ¥112 level. That’s an area that could open the door to the ¥111.50 level again, which was where the buyers return. It’s likely that we will continue to see a lot of noise in this pair, and of course the fact that the four hour chart has just broken through the back of a hammer suggests that we could see even more bearish pressure. It’s obvious to me that we are starting to become very skittish in global markets overall, and the USD/JPY pair will be a conduit as to the expression of this.

The 61.8% Fibonacci retracement level underneath of course will attract a lot of attention but if we break down through that level, it’s likely that the market will continue to go much lower, perhaps reaching towards the ¥111 level, and then eventually the ¥110 level. At this point, the market is teetering on a major break down, but we could also find buyers at this low level, but I would be very cautious about jumping in here. At this point, I think a little bit of caution may be the best way to trade this market. In general, I do think that there is some value down to be had, but stability is going to be crucial before we put any money to work. The recent turnaround has been rather brutal, so pay attention to stock markets as it could give us an idea as to where this pair goes.

USD/JPY Video 24.10.18