USD/JPY Price Forecast – US dollar pulls back to find support

The US dollar pulled back initially during the day on Monday, reaching down to the ¥108 level. By doing so, the market has shown that the ¥108 level is still important, and that breaking below it is of course a major deal. I think at this point we are likely to see a little bit of a bounce but I anticipate that the ¥110 level will be far too much for the market to overcome and will be more than willing to start selling in that area. I believe that the US dollar is starting to suffer a bit, perhaps due to the Federal Reserve and its proclivity to observe the markets a bit more.

USD/JPY Video 08.01.19

The Japanese yen is of course a safety currency, and with the US/China trade war issues out there it makes sense that the Japanese yen could be attractive to some traders. I think that the first couple of months of 2019 will continue to be a major issue, and therefore it’s likely that we will continue to see the Japanese yen pick up some strength. The fact that we are well below the 200 day EMA that is now turning lower, so that of course is a very negative sign as well. I look to fade rallies, and I would say that it looks like we are getting ready to start one relatively soon. Ultimately, I think that if you are patient enough you should get a nice selling opportunity in the next few days.