USD/JPY Price Forecast – US Dollar Recover Slightly On Tuesday Against YenPerhaps the markets are finally calming down a bit, because we are starting to see the US dollar recover a bit against the Japanese yen. We are testing the 50 day EMA, so it’ll be interesting to see what happens next.
The US dollar rallied a bit during the trading session on Tuesday, reaching towards the 50 day EMA. If we can break above the 50 day EMA, then it’s likely that the market will then go to the ¥110 level. To the downside, if the lows of the Monday session were broken it’s likely that the market will go looking towards the bottom of the overall channel that we have been in. Keep in mind that the FOMC Statement comes out tomorrow, so it’s very likely that the market will make a huge move until then. That being said though, if the Federal Reserve is a bit more dovish than anticipated, it could produce the opposite effect that you might be looking for here, because it should produce more of a “risk on” attitude in the stock markets, and as a knock on effect people start selling the Japanese yen, thereby pushing up the value of the US dollar, as they run away from safety.
USD/JPY Video 29.01.20
All things being equal though, it looks like we are probably on hold for about 24 hours, at least until that announcement comes out. We have clear areas of support and resistance and therefore we know where we get triggered, and then we know where we go looking towards afterwards. Further strengthening the uptrend channel is the fact that there is the 200 day EMA and the same neighborhood, and that of course will attract a lot of attention as well. With this, I’m very neutron this pair for the next 24 hours but recognize that we are about to have a breakout
Please let us know what you think in the comments below