USD/JPY Weekly Forecast – US Dollar Runs Out of Steam Against Japanese Yen

USD/JPY Forecast Video for 15-01-2024

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has been very noisy during the course of the week against the Japanese yen, which does make quite a bit of sense considering that we were challenging the 145 yen level. If we can break above the top of the candlestick, that would be very bullish, and it could send this market to the 147.33 yen level and then the 149.80 yen level. The shape of the candlestick does suggest that we could have a little bit of a pullback here and I think that makes sense. As I record this, we’ve got a hotter than anticipated CPI number followed by a weaker than anticipated PPI number. So, there are a lot of questions about what the Fed’s going to do.

That being said, if we can break down below 140, then I think it really opens up a lot of selling pressure, but right now, it looks like we’re more or less going to head into a consolidation phase. Because of this, I think you have to be cautious about being a longer-term trader with this pair, but short-term traders will probably continue to relish the idea of buying “cheap dollars” in this general vicinity.

If we break down below that 140 level though, that could send this market racing to the downside, perhaps all the way down to the ¥130 level, although it is not necessarily something that I am looking to see happen very easily or anytime soon. I think that the next couple of weeks will probably be very choppy as we wait for the next Bank of Japan meeting.

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