USD/JPY Price Forecast – US Dollar Reaching Towards 50 Day EMA

The US dollar has rallied initially during the trading session on Friday, reaching towards the 50 day EMA which of course is an indicator that has been important more than once in the past. You can see that we have clearly shown a favoritism towards that as significant resistance, so therefore it makes a certain amount of sense that there will be a bit of hesitation in that general vicinity. With that being the case, I am looking for some signs of exhaustion on shorter-term charts in order to start selling this pair again. However, I would note that the most recent pullback suggests that there is a little bit more of confusion here. At this point, the market is likely to see a lot of volatility, but we are still very much in a downtrend despite the fact that we have had less of a pullback.

USD/JPY Video 25.01.21

Looking at this chart, the ¥102.50 level could be the target on a breakdown, but I need to see signs of exhaustion on the short-term chart before start selling again. To the upside, I believe there is a lot of resistance that extends all the way to the ¥105 level, which is rapidly being backed up by the 200 day EMA above. With that being the case, I think it is only a matter of time before we get a nice opportunity to start shorting again. If we break above the ¥105 level, then we have to revisit the entire thesis. However, we may need a day or two to settle down before we can start shorting again.

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