USD/JPY Price Forecast – US dollar tests resistance

The US dollar has rallied a bit during the trading session on Monday to kick off the week, breaking towards the highs that we have seen last week, and if we can break above there it opens up the gate to much higher pricing, not the least of which would be the ¥109.65 level. That is basically where we see the 50 day EMA, and of course the major breakdown that sent the market down to these levels. With that in mind, it would make sense to see a lot of resistance there.

USD/JPY Video 18.06.19

The alternate scenario is that we pull back from here, which again wouldn’t be much of a surprise, because it would be a simple return to consolidation. That could send the market down to the ¥108.10 level without changing much in the way of attitude. That being said, I would look for short-term move at that point but recognize a move below the ¥107.70 level would break the 61.8% Fibonacci retracement level, which is typically a sign that we are going to go much lower.

If that were to happen we could break down to the ¥105 level as it would wipe out the entire move as expected. However, it certainly looks as if we will continue to find buying pressure in this market, so I prefer a breakout to the upside. That being said, you must simply follow what the market tells you, and it certainly looks as if it could make that decision rather soon.

Please let us know what you think in the comments below