USD/JPY Price Forecast – US dollar finds support

The US dollar has initially pulled back during the trading session on Wednesday, showing signs of stability at the ¥108.50 level before bouncing again. This of course is a bullish sign, as we hang about the 50 day EMA, as it is slicing through the last couple of candles. The fact that we turn around as rapidly as we did suggests that we should continue to grind to the upside, perhaps trying to take out the very negative looking candle stick that sent the market down to this level. The move to the upside would be a “risk on” move, which jibes well with the idea of lower interest rates, as it should send stock markets higher.

USD/JPY Video 11.07.19

I like buying this pair on short-term pullbacks and do believe that we have plenty of juice underneath to send this market to the upside. The ¥109.70 level is an area where I would expect to see a lot of resistance, so if we could break above that level, we then could go to the ¥110 level, followed by the ¥110.50 level. All things being equal, that is my plan but it’s going to take some time to get there.

However, if the stock markets turn around to get hammered for some reason, that could send this market back down towards the ¥180 level which I think is a major support barrier. Ultimately, breaking down below there would wipe out any type of positivity, but that does not seem very likely due to the price action of the last several days.

Please let us know what you think in the comments below