USD/JPY Price Forecast – US dollar breaks down against yen

The US dollar has broken down rather significantly during the trading session on Friday, slicing through the ¥109 level. By doing so it looks very likely that we will continue to reach down towards the ¥108 level. That of course is a major support level, so if we can break down below there, the market is free to go much lower. This will probably come down to the risk appetite situation in the world, especially in the stock markets and the like. This pair does tend to move with the S&P 500, so if the S&P 500 has broken down, that should send this market much lower.

USD/JPY Video 03.06.19

The ¥109.70 level above is massive resistance, and if we can break above there it’s likely that the market goes to the ¥111.15 level which was the scene of a major gap. At this point, I believe that the market will continue to be very noisy, but it’s clear that the major battle is going to be fought at the ¥108 level. I suspect that will probably happen, but we may get a short-term rally to open up the week. I believe the ¥109 level would be resistive as well, so at the first signs of exhaustion I’d be more than willing to sell this pair because this breakdown has been rather significant and sudden. There are a whole plethora of reasons to think that risk appetite is going to peel off, so it makes sense that we see the Japanese yen to strengthen.

Please let us know what you think in the comments below