USD/JPY Price Forecast – US Dollar Continues Momentum Higher

After having an explosive day on Tuesday, the US dollar continues to grind higher as it attacked the ¥109 level. This is more about the Japanese yen then the US dollar, as we are seen multiple currencies rise against the Asian counterpart. At this point, if we can break above the highs of the trading session for Wednesday, then the Japanese yen is likely to suffer at the hands of more selling. Breaking above the ¥109 level opens up the door to the ¥110 level, and perhaps even higher than that.

USD/JPY Video 29.04.21

Looking at this chart, the 50 day EMA underneath should offer support again, especially as we had formed a couple of hammers that kicked off this move to the upside. At this point in time, the market is likely to continue to see a lot of upward pressure, as the Japanese yields continue to shrink, while the US yields are much better in the bond market than Japan. With that being the case, I think we are going to go looking towards the highs given enough time.

However, if we break down below those couple of hammers that kicked off this move, then I would anticipate a much deeper move to the downside. That being said, that does not seem likely to happen especially as the US 10 year yield is starting to rise again, so that should continue to be a major driver of this market going forward. Whether or not we can break above the recent high is a completely different question, but it is worth noting that the pullback was only back to the 38.2% Fibonacci retracement level.

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