USD/JPY Price Forecast – US dollar rallies to end the week

The US dollar has been bullish during most of the session on Friday, breaking towards the ¥110.75 level. That’s an area that has been resistance in the past, and of course we have broken above the downtrend line, although just barely. The market looks likely to go looking towards the ¥111 level, and if we can break above there, I believe that fresh, new money will come into this market and we should continue to go much higher. In the meantime, I would assume that we remain consolidated, but should favor the upside all things being equal, as we have stronger interest rates in the United States as compared to Japan overall.

I think that pullbacks could offer buying opportunities, but I would be very cautious about putting too much money to work, at least until we can clear the ¥111 level. A break above there should open the door to the ¥112.50 level next. Overall, I believe that we will continue to see noisy trading in this pair, as the headlines will continue to move from day-to-day, as most of what we are moving on is pure emotion these days. Anybody who has tried to trade this market previously would know that this is a very emotionally charged market, so be careful but I think overall we will eventually break out to the upside.

USD/JPY Video 02.07.18