USD/JPY Price Forecast – US dollar dancing around 50 day EMA

The US dollar has bounced a bit during the trading session on Wednesday, breaking back above the top of the 50 day EMA. By doing so, the market looks as if it is trying to reenter the previous consolidation area but quite frankly I think there are enough of reasons out there to expect trouble from a risk appetite scenario, that should probably send this market lower. With this, I’m looking to sell signs of exhaustion.

USD/JPY Video 26.09.19

To the downside, the ¥106.75 level has a certain amount of magnetic behavior to it, so if we break down, is very likely that we will head towards that level. To the upside, we have the 50% Fibonacci retracement level which has acted as a lot of resistance, and of course has the 200 day EMA just above it. That is an area that I think will continue to cause issues, and make this market sell off.

Remember, the pair is risk sensitive, so obviously a lot of headlines can come across the wires to cause issues, but quite frankly I think that the market is probably focusing more on the US/China trade situation than anything else. It’s obvious that the political noise in the United States isn’t going to help the situation either, but quite frankly that is a minor story. Overall, the market will continue to be noisy and erratic, but overall the downtrend should continue, and it is somewhat indisputable although noisy at this point in time. A return to the bottom is probably most likely.

Please let us know what you think in the comments below