USD/JPY Price Forecast – US dollar pulls back

The US dollar pulled back a bit during the trading session on Tuesday, as the ¥112 level continues to be an area of trouble for the buyers. Ultimately, this is a market that will tend to move in the same general direction as risk appetite, which one of the best barometers for this pair tends to be the S&P 500. If that continues to rally and show strength yet again, we will more than likely get buyers jumping back into the marketplace to take this pair to the upside. If we can clear the ¥112 level, then we can really get moving. At that point I would anticipate that we will probably go towards the ¥113.50 level. However, I would not say that it’s going to be easy to do.

USD/JPY Video 01.05.19

To the downside, we have the 200 day EMA just below and that has recently offered a bit of support. That almost always catches some attention, so at that point it’s very likely that we will see a lot of noise. I would expect buyers to show up, but if we were to break down below the ¥111 level, then it opens up this pair for a move down to the ¥110 level. All things being equal though, the buyers have been rather aggressive as of late, so I would fully anticipate that we should get a bit of a bounce from here. If we were to somehow break down below the ¥110 level, that would have me concerned, perhaps looking for this market at that point to go down as low as ¥108.50. However, that seems very unlikely at this point.

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