USD/JPY Price Forecast – US Dollar Gets Hammered

The US dollar has gotten absolutely hammered against the Japanese yen, breaking below the ¥103 level in the middle of the session. Ultimately, this is a market that I think will eventually see an attempt to get down to the ¥102 level, where we have even more support. That being said, with the stimulus in the United States, it is very likely that we will continue to see the US dollar suffer. At this point, any time we get a short-term rally it is time to start selling again, as has been the case for quite some time. Ultimately, I do think that the market will continue to focus on stimulus going into the new year, but we also have to deal with the idea of a lack of volume.

USD/JPY Video 31.12.20

I still believe that the ¥104 level above is going to be a massive amount of resistance, and if we did for some reason reach that level again, I would be one of the first people to start selling as soon as we showed the slightest hint of exhaustion. Quite frankly, I do not think that this is a market that is anywhere near trying to change its trend, but I also recognize that we are extremely extended to the downside. The 50 day EMA sits just above the ¥104 level as well, so that is another reason to think that we could continue to see a lot of selling pressure. The 50 day EMA has been important more than once, so at this point in time it is likely that will continue to be the case in the immediate future.

For a look at all of today’s economic events, check out our economic calendar.