USD/JPY Price Forecast – US dollar continues to hover

US dollar continues to bounce around the ¥109 level during trading on Wednesday, as the market simply doesn’t know where to go next. There seems to be a lack of consensus when it comes to risk appetite right now, the markets are simply a bit of a malaise.
Christopher Lewis
USD/JPY daily chart, May 30, 2019

It looks as if summer has finally showed up, as currency markets have calmed down. There is a significant lack of new slow right now so at this point in time we need to rely solely upon technical analysis. Currently, it looks as if the ¥109 level is supportive and a breakdown below there could open up the door down to the ¥108 level, an area that I believe is even more supportive.

USD/JPY Video 30.05.19

On the other side of the equation we have the bullish case. The ¥110 level is of course important, and a break above there allows the market and finally go fill the gap above that I’ve been talking about for a couple of weeks now, found at the ¥111.15 level. A break above that level would of course be even more impressive and could send this market looking towards the ¥112 level, maybe even ¥112.50.

However, right now we simply have no reason to move in one direction or the other. Traders are starting to think more about summer vacations than anything else, and of course the lack of news flow cripples the idea of whether we are in a “risk on” or possibly a “risk off” environment. At this point, the US/China trade relations are without a doubt the biggest story, and quite frankly I think the market is getting a bit tired of the whole situation, reacting less and less every time there is a new headline.

Please let us know what you think in the comments below

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