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

The US dollar has pulled back a bit during the trading session on Thursday to show signs of noise yet again, and at this point it looks as if the 200 day EMA should offer support, so in general I think this is a market that will try to decide whether or not there is enough momentum to turn around and rally. The ¥105 level underneath is also supported as well, so it will be interesting to see how that plays out.

The pair has been moving based upon interest rates in the United States rising, which of course makes the US dollar a bit more attractive than the low yielding Japanese yen. Furthermore, this pair does tend to rally in a “risk on” type of mode as well, so it is possible that is starting to come back into the forefront.

I do believe that eventually we go looking towards the ¥108 level, possibly even as high as ¥110, but that is a longer-term call. I do believe at this point we will more than likely see a lot of noisy trading because if we are in fact changing the overall trend, this is almost always a very difficult thing to do and it does take quite a bit of effort. If that is going to be the case, then paying close attention to what is going on as far as supportive looking candles are concerned is the way to go. This does not mean that we go straight up in the air, and if we broke down below the red 50 day EMA I would consider this a “false breakout.”