USD/JPY Price Forecast – US dollar falls against Japanese yen in risk off move

The US dollar has fallen rather hard during European trading, as traders on the continent rushed to pick up the Japanese yen based upon safety. The market looks likely to continue to be noisy in general, as there are so many conflicting headlines out there that will cause a bit of a “risk off” attitude. I believe that the market does favor the US dollar in general though, but this might be the lone exception. Remember, traders will pick up the Japanese yen based upon some type of safety bid. I believe that the market will eventually turn around though, as I see a ton of support underneath, and we have essentially been grinding in a sloppy sideways market for some time. This market saw a lot of buying in this area recently, so I think that we may see more. The ¥110.50 level underneath has been very supportive, just as the ¥110 level has been. Ultimately, I’m a buyer of dips, as I think they represent a significant amount of value.

Pay attention to headlines coming out of Turkey, while not directly affecting this pair, there is a bit of a “knock on effect” when it comes to risk appetite with the Turkish lira, so while the US dollar screams in value against other currencies, it could fall against the Yen of people worried about contagion. Ironically, it could also lift this pair if people are not so worried about contagion. A bit confusing I know, but ultimately I believe buyers will return.

USD/JPY Video 16.08.18