USD/JPY Price Forecast – US Dollar Pressing Major Resistance BarrierThe US dollar initially fell during trading on Tuesday but continues to find buyers underneath as the Japanese again see their currency fall in value.
The US dollar has fallen a bit during the trading session on Tuesday, reaching down towards the ¥110 level before bouncing again. The US dollar has been ripping higher based upon US dollar shortages around the world, but now it appears that with a bit of a “relief rally” going on in the United States stock markets as well as many of the other global ones, the Japanese yen is sold in more of a “risk on” type of scenario. That being said, the market is overstretched so at the very least it needs to kill some time up in this area before going higher. Otherwise, a pullback makes quite a bit of sense, and I do believe that the ¥108 level would be an area where value hunters will probably get involved.
USD/JPY Video 25.03.20
Ultimately, the markets are trading on the latest headline and therefore it is difficult to be confident with any particular position. With that in mind, it’s best to keep the position size relatively small, and only add if the trade works in your favor. This is probably sound advice for any trade you take on, but is going to be especially important in the environment that we find ourselves in. This reminds me a lot of 2008, when markets would pick up steam and make passive moves, much bigger moves than you would normally expect, and then show signs of confusion like we are going through right now. Quite frankly, there is a lot of fear out there so that should be kept in the back of your mind, as protection and preservation of capital is your number one job right now.