USD/JPY Price Forecast – US Dollar Continues Sideways Action Against Yen

The US dollar has rallied a bit during the course of the trading session on Monday to reach towards the ¥114 level again, supported by the 50 day EMA yet again. All things been equal, this is a market that does not seem to have enough momentum to go anywhere, but I do not necessarily think that means that we are going to pull back either. Quite frankly, I would not be surprised at all to see this market do a whole lot of nothing over the next couple of weeks as we head into the end of the year.

USD/JPY Video 14.12.21

Keep in mind that we are at relatively elevated levels, so the ¥115 level should be an area that you pay close attention to. The ¥115 level has been important going back multiple months, and therefore a breakout above that level is something that would attract a lot of attention. To the downside, if we were to break down below the ¥112.50 level, then the market could go looking towards the 200 day EMA, which currently sits just below the ¥111 level. After that, then the next support level would be found somewhere near the ¥110 level.

Ultimately, this is a market that is waiting for some type of catalyst, and we may get that later in the week if the Federal Reserve surprises people with its announcements on Wednesday after the two-day meeting. Beyond that, I do not see much in the way of a catalyst for anything more than a lot of back-and-forth sideways action. One thing worth noting is the biggest candlestick by far that has been printed lately has been a decidedly negative one.

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