USD/JPY Price Forecast – US Dollar Rallies Against Yen

The US dollar rallied a bit during the trading session on Tuesday as we continue to see money flow into the US dollar in general. That being said, the market is also rallying due to the fact that the US stock market rallied a bit, and as a result we started to see money flow away from the Japanese yen but is probably short-lived. After all, there are a whole slew of issues out there that people continue to worry about, not the least of which of course is the virus.

USD/JPY Video 18.03.20

Ultimately, the 200 day EMA sits just above and it looks likely that the indicator will continue to offer a certain amount of psychological resistance as well. Quite frankly, one would have to think that the overall fear is over in order for that level to get broken. I think it’s only a matter of time before exhaustion comes in and we start fading again. For that matter, it may not necessarily be a fading of the rally, but it might be a complete turnaround based upon some headline. Furthermore, the 50 day EMA is getting ready to cross below the 200 day EMA which kicks off a lot of technical signals.

Don’t get me wrong, I don’t necessarily think that it is going to collapse, rather that we are trying to carve out a longer-term range to go back and forth in. I certainly believe that the market is probably going to continue to be very volatile, so position sizing should be a major part of your trading plan, keeping the position size low enough that some major breakdown doesn’t, and wipe you out.