USD/JPY Price Forecast – US Dollar Looking Sluggish Against Yen

The US dollar has been a bit sluggish over the last 48 hours against the Japanese yen, something that you can probably expect to continue seeing considering that the market has so much in the way of resistance. The ¥111 level above begins a significant amount of resistance that extends to the ¥112 level. With this being the case, it is more likely than not going to be difficult to go much higher over the longer term.

USD/JPY Video 12.08.21

We are most certainly chopping around in a probing action to the downside, as we have made three “lower lows” in a row but continue to see massive resistance above. Ultimately, I think that you are looking for opportunities to fade short-term exhaustion, but whether or not we break down drastically is a completely different question altogether. With that being the case, the market is probably going to continue to see a lot of noisy behavior, but I think the Japanese yen will continue to attract a certain amount of attention, as this pair is highly sensitive to risk appetite. If for no other reason than relative strength, you should keep an eye on this chart as if we break down over here, it will be especially tough on other Japanese yen related pairs.

After all, when you look at other currency such as the Australian dollar, they look a bit soft. The stands to reason that if the Japanese yen can rally against the US dollar, then it is likely that it will absolutely pummeled the Australian dollar. This is a good barometer for risk appetite, and therefore it is worth watching is very closely.

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