USD/JPY Price Forecast – US Dollar Pulls Back Towards Major SupportThe US dollar has pulled back a bit during the trading session on Monday, reaching down towards the 200 day EMA, and the ¥109 level. Ultimately, this is a market that is trying to build up enough momentum to finally break out.
The US dollar has pulled back a bit during the trading session on Monday to kick off the week, as there are a lot of concerns whether or not the trade war is going to get any better. At this point, the market has been testing the 61.8% Fibonacci retracement level, which is the ¥109.50 level, that extends to roughly the ¥110 level. However, at this point the market is likely to find support at the 200 day EMA underneath, as it has over the last several days.
USD/JPY Video 12.11.19
At this point, market participants are also watching the 50 day EMA which is pictured in red on the chart, as it looks ready to cross the 200 day EMA, forming the so-called “golden cross.” This is a market that will continue to be paid close attention to as it is a major risk barometer more than anything else. That being said, the market was to break above the ¥110 level, then the market could go to the ¥111 level next, and then eventually the ¥112.25 level. That would more than likely coincide with the stock market exploding to the upside, and then perhaps other “risk on” trades would come in to vote.
To the downside, the 50 day EMA has offered major support underneath, so if we were to break down below the ¥108 level, the market will more than likely continue to go much lower. That being said, it could open up the door down to the 160 and level next. Expect choppy and volatile trading over the next couple of days.
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