USD/JPY Price Forecast – US Dollar Continues to Drift Lower

The US dollar has initially tried to rally during the trading session on Monday, but then broke down below the ¥103 level to continue the overall downtrend. That being said, this is a pair that is choppy to say the least so we will get the occasional bounce that you can look towards selling into. The 50 day EMA sits just above the ¥104 level, which of course is a large, round, psychologically significant figure. That being said, I do believe that the 50 day EMA will continue to cause resistance, extending all the way to the 200 day EMA which is at roughly ¥106.

USD/JPY Video 05.01.2021

As far as a target is concerned, I still believe that this pair is going to go looking towards the ¥102 level, but it is going to take some time to get down there, and therefore think you need to continue to focus on this as a short-term market more than anything else, but most certainly we have a downward bias in general, so there is no point in trying to fight that. That being said, I think that people will look towards rallies as more opportunities. The US dollar course is losing due to the fact that there is a significant amount of stimulus coming out the United States, and of course you can also make an argument for the idea of the Japanese yen being looked at as a “safety currency” as well. Ultimately, I have no interest in buying this pair anytime soon.

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