USD/JPY Price Forecast – US Dollar Rallies Again Against Japanese YenThe US dollar has rallied a bit during the trading session on Thursday, reaching towards the ¥112 level. The ¥112 level is an area where we had sold off rather drastically, and most clearly the market is a bit overbought.
The US dollar has rallied again during the trading session on Thursday, reaching towards the ¥112 level. We are bit overbought at this point though, so don’t be surprised at all to see this market pullback. If it does, the ¥110 level underneath is what I would consider to be the “floor” at this point. I believe that the market is probably getting a bit tired, and therefore I think a pullback is something that you should look at as an opportunity. As we head into the weekend, it’s likely that we could find some type of profit-taking so this all lines up quite nicely.
USD/JPY Video 21.02.20
Having said all that, the market did continue to break higher, then I think the ¥112.33 level is the next target, and then eventually the ¥114 level. At this point, the market has clearly shown the direction it wants to go, but that doesn’t mean we get there in one shot. Now that we have clear the ¥110 level, the uptrend can continue, and you should know that the ¥110 level was essentially “fair value” for the market longer term. Because of this, the market is likely to see a longer-term move higher, but it’s going to take some time to get there in my estimate. Look at pullbacks as value, and as long as we can stay above the 50 day EMA which is currently at the ¥109.50 level, the uptrend should be intact and should offer plenty of opportunities given enough time. Patience and adding slowly could give you the opportunity to build up a huge position.