USD/JPY Price Forecast – US Dollar Pulls Back Against Yen

The US dollar has initially tried to rally during the course of the trading session on Wednesday to break back down below the ¥110 level. That being said, the market is likely to pull back a bit towards the 50 day EMA, but we also have the FOMC meeting going on, and it looks as if the announcement could have a major influence on where it is going to go to next. That being said, if it is more of a “risk on” type of attitude that we have out there, that also helps the pair go higher.

USD/JPY Video 17.06.21

To the downside, if we break down below the 50 day EMA it probably opens up the possibility to reach down towards the ¥108 level. The ¥108 level does have a significant amount of importance to it, due to the fact that we have bounced from there previously to form the channel that we are currently in, and of course it is the 38.2% Fibonacci retracement level. Breaking down below that level probably opens up a much more significant move lower, especially as the 200 day EMA seems to be reaching towards that same area as well.

Looking at this chart, I think we are going to continue to see buyers on dips, but if we do get that break down it could send this market looking towards the ¥105 level. If the Federal Reserve looks to trash the US dollar, that may be one of the main reasons to push this market lower, but right now I do not see that happening, at least not to that extent.

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