USD/JPY Weekly Forecast – US Dollar Gives Up Early Gains For the Week Against the Yen

USD/JPY Forecast Video for 27.03.23

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has initially rallied against the Japanese yen for the week, but then turned around to show signs of hesitation as we then turned around to plunge towards the ¥130 level. The ¥130 level of course is a large, round, psychologically significant figure, and an area where a lot of people would be paying close attention to. That being said, after that we have the ¥127.50 level, which of course is an area that has been structurally supported recently, and even formed a double bottom a while back.

Beyond all of that, the 50% Fibonacci level is right there as well, so it’s probably worth paying close attention to that level. If we were to break down below the ¥127.50 level, that would obviously be a very negative turn of events and could send this market plunging.

Keep in mind that the Bank of Japan continues to fight interest rate pressure, as the 10 year JGB has a cap of 50 basis points on it. In other words, this comes down to whether or not the Bank of Japan will have to print more yen to fight rising rates, or if they can let it go. All things being equal, this will be interesting to see how this plays out, as we have seen a lot of noise in this pair, and I think it will continue to be very volatile. Position sizing will be crucial, as you could find yourself in a lot of trouble if you get over levered in what has been a very noisy market.

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