USD/JPY Weekly Forecast – US Dollar Gives Up Early Gains for the Week

USD/JPY Forecast Video for 21.08.23

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has initially rallied during the course of the trading week, but has found a little bit of exhaustion coming into the picture. With that being the case, I think you got a situation where shorter-term traders are going to determine where this market goes next, and it does make a certain amount of sense that we perhaps ran into some resistance at the top of the huge negative candlestick from the middle of last year that we tested. That being said, I think a short-term pullback comes into the picture to offer value.

All things being equal, this is a market that I think continues to see a lot of noise near the ¥142.50 level, which is an area that’s been noisy more than once. Underneath there, the ¥140 level could offer support as well, so I do think that it is probably only a matter of time before the buyer step in. If we were to turn around a break above the top of the candlestick, then it opens up the ¥150 level. The ¥150 level of course will have a lot of psychology attached to it, so I would anticipate a lot of noise in that general vicinity. All things being equal, this is a market that I think continues to favor the upside mainly due to the interest rate differential, so even if we do pullback from here, I would anticipate that a lot of buyers should come into the picture and try to take advantage of the end of the day swap.

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