USD/JPY Price Forecast – US Dollar Continues to Hang at 108 JPY

The US dollar has gone back and forth during the trading session on Thursday, as we continue to hang around the ¥108 level. This is an area that seems to be showing signs of stabilization, something that this pair desperately needs after this massive pullback. Quite frankly, we have been in an uptrend for very long time but were parabolic, so this pullback was probably necessary. Another thing that makes this particular interesting for me is the fact that the 50 day EMA sits right here, and that will attract a certain amount of attention in and of itself.

USD/JPY Video 23.04.21

This is the third day in a row that we are sitting around in a relatively tight range, so that tells me that at least there are people willing to jump in and pick up the market, if not cover shorts. Whether or not we can continue to go higher is still a bit of an open question, but I think the obvious trigger would be if we can break above that inverted hammer formed on Tuesday. If we get above there, then it is very likely that the market will see a significant move to the upside. At that point, I would fully anticipate that we go looking towards the highs again, as the yield differential between the two currencies favors the upside.

If we do break down below the lows of the last couple of sessions, then I think we go looking towards the ¥107 level. The ¥107 level of course is a large, round, psychologically significant figure and has the 200 day EMA approaching it at the moment, so that could be another area of interest.

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