USD/JPY Price Forecast – US Dollar Continues To Press Resistance

The US dollar pulled back slightly during the trading session on Wednesday in early trading, as we continue to bang up against the crucial 61.8% Fibonacci retracement level. If we can get a major breakout from here, this could be monumental.
Christopher Lewis
USD/JPY daily chart, November 07, 2019

The US dollar has pulled back a bit during the trading session on Wednesday in order to reach towards the 200 day EMA. What is particularly interesting is that the 200 day EMA is starting to offer a bit of support. That’s a strong sign for the buyers if we can possibly make that breakout. The 200 day EMA of course is crucial, because it is a longer-term trend following type of indicator. If we continue to see the market stay above the 200 day EMA, is very likely that it is only a matter of time before we make the longer-term break out and go looking towards the 100% EMA which is closer to the ¥112 level.

USD/JPY Video 07.11.19

Don’t be wrong, the ¥110 level will of course offer significant resistance above, but breaking out from this point would suggest a rough “inverse head and shoulders”, which of course is a very bullish pattern as well. Ultimately, everything is lining up for a breakout, and with the “risk on” attitude that we have seen out of Wall Street, it would make sense that as the S&P 500 goes higher, the dollar/yen pair will continue to see a lot of volatility, but should be rather positive in general. The 50 day EMA is underneath and offering massive support at the ¥108 level, so I suspect that will be the “floor” in the market. Expect choppy behavior, but it certainly looks as if the pressure is building up underneath and will eventually overwhelm the market.

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