USD/JPY Price Forecast – US Dollar Continues To Build Support

The US dollar has rallied a bit during the trading session on Tuesday, as we continue to hang around the 200 day EMA. At this point, if the market was to break out to the upside, it should send this market looking towards the 50 day EMA, and then eventually the ¥109.60 level. That is the area that continues to offer a lot of resistance and keeps this market from rallying significantly, so keep in mind that a breakthrough that level would be crucial to determining where we go next. In the meantime, expect a lot of choppiness as there are a lot of moving pieces out there that can drive risk appetite.

USD/JPY Video 08.01.20

Furthermore, this is a market that has a lot tied to the US/China trade situation, which seems to be getting better, but it is early days at this point. With that in mind I like the idea of waiting to see whether or not we get a daily close above the last couple of candles before buying, just as I would want to see a fresh, new low before selling. If we do get the breakdown, the market could go down to the ¥106.50 level, but that is probably going to be accompanied by bad news in general. With that being the case, it’s possible that it could be US/China related, or for that matter it could be something to do with the Americans and the Iranians. Either way, there are a lot of risks out there that could come into play.

Please let us know what you think in the comments below