USD/JPY Price Forecast – US dollar rallied slightly after strong jobs number

The US dollar has initially rallied to kick off the Friday session after the Nonfarm Payroll Numbers came out but didn’t exactly explode to the upside after the addition of over 300,000 jobs. This is a bit telling, because the fact that the number could lift the US dollar higher than that suggests that perhaps there are a lot of other concerns right now. One would think that it would be very inflationary, thereby pushing the Fed into a corner to continue to raise interest rates, but there are so many global issues right now that it’s not surprising that the Japanese yen still attracts a lot of attention.

USD/JPY Video 07.01.19

While we have broken above the top of the neutral candle for the previous session, I suspect that it’s only a matter of time before the sellers come back, so I’m looking for signs of exhaustion, especially if we can get close to the ¥110 level. At this point, I suspect that we are looking at a marketplace that may get a bit of a relief rally, but I look at that as an opportunity. We have broken down through a major trendline recently, and perhaps have gotten ahead of ourselves to the downside but I do think that there is plenty of reason out there to think that we are going to struggle. Ultimately, I think that the global issues around growth and various countries will continue to weigh upon risk assets, so that means that the Japanese yen should continue to strengthen but obviously we had gotten far ahead of ourselves previously.