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

The US dollar has rallied significantly during the trading session on Tuesday, breaking above the top of the shooting star that formed on Monday. Quite frankly, after Monday’s candle I suspect that we would drop to fill the gap, but there should be plenty of support in that area, roughly the ¥108 handle. I also recognize that there is support just below at the 61.8% Fibonacci retracement level, so overall I would believe that there are plenty of buyers underneath to pick this market up. It will also move with risk appetite, so pay attention to other markets such as the S&P 500 which is my favorite secondary indicator for this pair.

USD/JPY Video 12.06.19

To the upside, we are probably going to try to wipeout that breakdown candle that fell from the ¥109.60 level. Whether or not we can break above the ¥109.70 level is going to be the next question, and if we do then I think we could finally go towards the ¥111.15 level which features a gap. I think that we will see the occasional short-term pullback, but it certainly looks as if there will be plenty of buyers underneath to support the market. I don’t have any interest in shorting this pair in the meantime, but if we were to break down below the 61.8% Fibonacci retracement level it probably will send this market down to the 105 young level underneath which is essentially the 100% Fibonacci retracement level. Until then, I think that we have a slow grind higher.

Please let us know what you think in the comments below