USD/JPY Price Forecast – US Dollar Rallies to Kickoff Week
The US dollar has rallied significantly during the trading session on Monday, breaking above the ¥109 level. However, we have pulled back a bit from there, it is very likely that the market continues to see a lot of choppiness in general. That being said, breaking above the ¥108.50 level is a good sign but we are still very much in the way of consolidation, so looking at this chart I believe that the ¥111 level will be massive resistance. Ultimately, this is a market that probably does try to grind of the higher levels due to the fact that there is a lot of demand for the US dollar.
USD/JPY Video 07.04.20
If we do rollover from here, the ¥107 level would be a significant support level, and if we can break down below there, it’s likely that the pair would then go looking towards the ¥105 level. Ultimately, this is a pair that will continue to move back and forth due to the fact that both of these are currencies that people run to for safety. In other words, it is still extraordinarily noisy, but it does look like we are favoring the upside just slightly as we have broken through a minor resistance barrier.
Ultimately, keeping your position size relatively small will probably be the best way going forward. Longer-term moves are going to be difficult to come to terms with, simply because there are so many moving pieces. Ultimately, this will probably be more or less a day-to-day operation. Because of this, I may choose to use this chart as a secondary indicator for other yen related pairs, measuring Japanese yen strength or weakness.