USD/JPY Price Forecast – US Dollar Sideways Against Yen Yet Again

The US dollar has rallied a bit against the Japanese yen during the trading session on Friday after initially plunging. The ¥104 level continues offer a bit of support, so therefore it does make sense that we would turn around. Having said that, there are also a lot of concerns out there when it comes to which direction to trade, simply due to the fact that we have no real traction in one direction or the other over the last couple of weeks. In fact, it almost looks as if it is a market that is trying to decide whether or not it can continue the downtrend.

USD/JPY Video 14.12.20

There are multiple things pushing this market around right now, not the least of which is the talk of stimulus in the United States, that being said, it does seem as is stimulus talks are very difficult for the children in Congress to get through, so it is possible that we may have a lot of bumps along the way. The idea of stimulus has been very negative for the US dollar, making it fall against several of its counterparts, including the yen. That being said, the yen is also considered to be a safety currency so if we get more of a “risk on” trade, then under normal circumstances it would push this pair higher. In other words, we are essentially stuck in this range.

Having said that, the next large candlestick you see in one direction or the other would probably give you a bit of a heads up as to where we go next. That being said, if the 103.70 level gets broken to the downside, that is much easier of a trade to take than anything relating to buying this pair.

For a look at all of today’s economic events, check out our economic calendar.