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

The US dollar broke out during the trading session on Tuesday, clearing the 100 will ¥0.75 level. Ultimately, this is a good sign, but I also see a lot of resistance above.
Christopher Lewis
USD/JPY Midday chart, October 30, 2018

The US dollar has broken out against the Japanese yen during early trading on Wednesday, which of course is a sign of risk appetite. If the Japanese yen starts to sell off a bit, perhaps that could be assigned that other asset classes will gain as well. Remember, the US dollar will be the first currency that people buy against the Japanese yen as we have seen so much in the way of US dollar strength anyway. It makes sense that the greenback would be the primary beneficiary, but it also signals that we could perhaps see other currencies rally against the Yen.

USD/JPY Midday Video 30.10.18

Clearing that area was a good sign, and I think that short-term pullbacks at this point are probably going to be nice buying opportunities, extending down to the ¥112 level. Overall, I think that we are getting ready to try to make a move towards the ¥114.50 level, which has been massive resistance in the past. I don’t expect to break above there in the short term, but I would anticipate several attempts to break above there as long as we can get some type of positivity when it comes to the overall risk appetite in general.

At this point, it’s likely that the market has plenty of buying pressure underneath to lift this market though, so look at pullbacks as an opportunity to take advantage of value as the greenback is most certainly the most positive currency that we have. At this point, expect volatility, but it certainly looks as if we are strengthening.

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