USD/JPY Price Forecast – US Dollar Sideways Against YenThe US dollar has done very little during the session on Wednesday, as traders are probably focusing more on risk appetite than anything else.
The US dollar has gone back and forth during the trading session on Wednesday as traders around the world are trying to assess risk appetite. Furthermore, the Federal Reserve will continue to weigh upon the US dollar, which keeps people looking towards other currencies, including the Japanese yen. With the Federal Reserve being so loose with its monetary policy, it is going to be difficult to see the US dollar gain significant strength, especially against the Japanese yen as if there is a sudden rush to safety, it probably will favor the Japanese yen anyway.
USD/JPY Video 26.11.20
Looking at this chart, you can see that the 50 day EMA sits just above and that should continue to offer resistance as it has for months. Furthermore, you should think about the fact that Thursday is Thanksgiving Day in the United States, so it is going to pull out a certain amount of liquidity once the Europeans go home. Because of this, it could be a rather quiet session, but the market still favors selling rallies going further, as we can see it has favored for quite some time. I see nothing fundamentally changing in this market, other than the fact that there is a vaccine coming down the road. However, until the central bank in the United States changes its attitude, there is still going to be pressure to the downside as the market will be flooded with liquidity regardless.
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That being the case, I fully anticipate that the market eventually goes looking towards the lows again, but it may be relatively quiet over the next couple of days. As far as buying this pair is concerned, I do not really have that scenario right now.
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