USD/JPY Price Forecast – US Dollar Gives Up Early Gains

The US dollar initially tried to rally during the trading session on Wednesday but gave back the gains as we continue to see a lot of resistance just above. That should not be a huge surprise, because quite frankly this is an area that has been difficult. At the ¥110.750 level, there is a lot of selling pressure that we had seen multiple times, so the fact that we are pulling back just a bit is not a huge surprise.

USD/JPY Video 09.09.21

To the downside, the ¥109 level has been massive support, just as the 200 day EMA has reached towards it. All things being equal, the market is likely to continue seeing a lot of choppy behavior as the 50 day EMA is also sideways. With this, the market is likely to continue to see confusion and probably is a scenario where if you are a short-term trader, it may work out but if you are looking for any type of significant move, forget it.

All things been equal, I think the ¥110 level continues to be a bit of a magnet for price, so with this being the case I think it is very difficult to see a reason to get overly excited one way or the other. You should keep your position size relatively small, mainly due to the fact that eventually we will get a big move, and then we probably take off rather quickly. With this, I think this is probably a market that you should be using the stochastic oscillator with, as it can give you a bit of a heads up as the wind to go back and forth.

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