USD/JPY Price Forecast – US Dollar Continues to Flex Muscles

The US dollar initially fell during the trading session on Wednesday but found the ¥105 level to be supportive enough to turn things around and show signs of life. At this point, the 50 day EMA is slicing through the middle of the candlestick so it is going to be interesting to see where we go from here. Looking at this chart, there is a huge amount of resistance between the 50 day EMA and the 200 day EMA indicators. All of that being said, one has to take a look at the massive move higher on Monday as a potential bellwether of a trend change, although it is quite early to suggest that.

USD/JPY Video 12.11.20

If we turn around a break down below the ¥105 level, the market is likely to go looking towards the ¥104 level. That is an area that would be interesting as it was a previous support level, but if we break down below there then we will test the lows again. On the other hand, if we are to continue going higher I expect a huge fight between here and the 200 day EMA, but if we can finally get above there it is likely that the market would go much higher, as it would suggest that we have a trend change on our hands.

I think it is a bit early to assume that, but it certainly is a real possibility after the recent action that we have seen. I think the whole world is waiting to see whether or not this was the bottom, so we have a few interesting days ahead of ourselves.

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