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USD/JPY Price Forecast – US Dollar Pulls Back Slightly

By:
Christopher Lewis
Updated: Jun 21, 2021, 16:38 UTC

The US dollar fell a bit against the trading session on Monday against the Japanese yen, only to bounce back towards the ¥110 level.

USD/JPY Price Forecast – US Dollar Pulls Back Slightly

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The US dollar fell a bit during the course of the trading session on Monday, breaking down towards the ¥109.50 level, only to turn around and show signs of life. As we have bounced significantly, the market looks as if it is trying to form a bit of a hammer. That is a very bullish sign, but we also have recently struggled at the ¥111 level, which of course is an area that I have mentioned more than once as significant resistance. Furthermore, the MACD shows divergence, which is also another reason to suspect that we might be running into a little bit of trouble.

USD/JPY Video 22.06.21

Underneath, the 50 day EMA sits near the ¥109.25 level, and that could offer a little bit of dynamic support. That being said, if we break down below it, we could go looking towards the ¥109 level, perhaps even below there to go looking towards the 200 day EMA. The 200 day EMA would of course be very crucial to pay attention to but what I think at this point we are looking at is a market that is trying to determine whether or not a longer-term “double top” has been put in the case.

All things being equal, I think that we will see a lot of noisy behavior, and at this point in time I believe that the ¥111 level is a major resistance barrier that will be very difficult to overcome, so at this point in time I think we continue to chop around and perhaps see more pressure building up for a potential pullback based upon the historical value of the area as a ceiling.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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