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USD/JPY Price Forecast – US dollar pulls back from major level

The US dollar tried to attack the ¥110 level during the trading session on Friday but gave back some of the gains as we continue to see a lot of trouble in this area. The 50 day EMA being just above of course offers resistance as well.
Christopher Lewis
USD/JPY daily chart, January 28, 2019

The US dollar has rallied a bit during the trading session during the day on Friday but has given back some of the gains as the ¥110 level continues to offer a lot of resistance. With that being the case, I do think that eventually we drop from here, as the ¥110 level will cause a lot of resistance from a large, round, psychologically standpoint, not to mention the fact that the 50 day EMA is just above. Beyond that, the 61.8% Fibonacci retracement level also offer resistance.

USD/JPY Video 28.01.19

We had recently seen a lot of bullish pressure in this pair, but at this point I think that the strong inertia is probably all but right now. I think it won’t be surprising to see this market roll over from here, and I believe that the ¥108 level makes quite a bit of sense. The technical damage that has been done recently can’t be forgotten, and therefore I think that we will probably need to retest the bottom. This isn’t to say that we can’t go higher, just that I recognize that we need to get through the ¥110 round figure, the 61.8% Fibonacci retracement level, the 50 day EMA, and then after that the 200 day EMA. This is a very negative situation longer-term, and as I have been watching this during the day, it’s been obvious that there is a lot of selling at ¥110 intraday as well. Because of this, I think if you are patient enough you should get a nice selling opportunity.

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