USD/JPY Price Forecast – US dollar rallies after BOJ comments

The US dollar rallied a bit during the trading session on Wednesday, reaching towards the ¥110 level. This is an area where we had seen previous support, and then beyond that we have the 61.8% Fibonacci retracement level that should cause resistance as well. Just above there, we have the 50 day EMA, so I think that if we see signs of exhaustion on a daily candle stick, then it’s time to start selling. Even though we’ve had a very strong candle stick for the session on Wednesday, I still think that this pair can probably be sold, if nothing else as a bit of a safety bid.

USD/JPY Video 24.01.19

On the roll over, I would expect this market to go down to the ¥109 level, and then eventually the ¥108 level. That’s an area that should be massive support considering what we have seen, and therefore I think it’s going to be difficult to break down through there. Once we do, the market will almost certainly go to the ¥105 level. The alternate scenario of course is that we break out to the upside but the black 200 day EMA will cause resistance as well, so I think that although things have looked good over the last 24 hours, the upside is probably somewhat limited and short-lived. Being patient will probably be the best way to trade this pair, as it does tend to trend for long periods of time, but right now we do not have the signal to start shorting.