USD/JPY Weekly Forecast – US Dollar Pulls Back Against the Yen

USD/JPY Forecast Video for 20.11.23

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has plunged during the course of the trading week, showing signs of negativity but at this point in time we still see support just underneath. On the upside, the ¥152 level is an area that we are going to continue to see resistance at, and if we can break above there, then it’s possible that the market could really take off to the upside. In that situation, the market probably goes looking to the ¥155 level, which is an area historically that has been important.

On the other hand, if we break down from here, then the market could drop down to the ¥147.80 level, an area that previously had seen both support and resistance. The Bank of Japan continues to have very loose monetary policy, while the Federal Reserve will stay tight. Yes, maybe they don’t necessarily continue to raise rates, but at the end of the day the interest rate differential continues to favor the upside is you get paid to hold this pair.

Yes, we are a bit extended and after this big move higher it does make a lot of sense to consolidate. That might be essentially what we are seeing right now, therefore I think you get a situation where we may have to work off some froth. It’s not until we break down below the ¥147.80 level that I would take any type of breakdown seriously. In the meantime, I think we get a situation where it’s only a matter of time before we see value hunters coming back in.

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