USD/JPY Price Forecast – US dollar drifts lower against Japanese yen

The US dollar has drifted a bit lower during the Monday session as we continue to see it struggle against the Japanese yen. The ¥110 level above has been massive resistance a couple of times now, so I think a pullback is very likely indeed.
Christopher Lewis
USD/JPY daily chart, January 29, 2019

The US dollar rolled over a little bit during the trading session on Monday again, as the ¥110 level has caused a lot of resistance. At this point, I think that the market is going to continue to go lower, perhaps reaching down to the consolidation area near the 100 a .50 level. That is the beginning of support down to the ¥108 level, which of course is massive support. That being the case, if we were to break down below the ¥108 level, that will open up much lower targets. I don’t know how easily that will be done, but clearly at this point looking at the chart is that we have the 50 day EMA just above, the ¥110 round number, and then of course the 61.8% Fibonacci retracement level. With all of those combined forces, I think that we will eventually see sellers jumping into this market.

USD/JPY Video 29.01.19

I believe that short-term rallies are to be sold, and I do think that we will see the US dollar soften a bit going forward as the Federal Reserve looks likely to step away from any type of quantitative easing, and now has even began to talk about possibly cutting back on its quantitative tightening or deleveraging the balance sheet. Those are both dollar negative, and I think that the fact that we have a lot of global issues out there, we could have a bit of demand for the Japanese yen is a safety currency as well.

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