USD/JPY Price Forecast – US dollar continues to find buoyancy against yen

The US dollar rallied a bit against the Japanese yen, typically a sign of “risk on” behavior, as it does tend to follow right along with stock markets, especially the S&P 500. I also recognize that there is a significant amount of resistance just above at the ¥114.50 level, which extends to the 115 young level. I think it will take several attempts to finally break through there if we do, but the Americans and the Chinese coming together and perhaps giving a boost to global growth expectations, or at least the tapering of tariff concerns may be the catalyst to make that happen. I don’t think an agreement gets signed over the weekend, but I do think some positive news will probably come of it.

USD/JPY Video 03.12.18

If we do pull back, and that is very possible considering that we need to build up so much momentum to break out, I think the uptrend line is still an important area to pay attention to, the ¥112 level is important, and of course the 200 day EMA under that would also be crucial. I think at this point, we should continue to see a lot of volatility, but I still think that the market favors the upside despite all of the noise. However, if we break below the 200 day EMA, then I would become very aggressive when it comes to shorting this market, aiming for at least the ¥110 level, if not the ¥108 level after that. Overall though, I think the one thing you can count on is a lot of noise.