FXEMPIRE
All

USD/JPY Weekly Price Forecast – dollar rallies towards ¥113, but then rolls over

The US dollar rallied quite a bit during the week, reaching towards the ¥113 level before rolling over. The market found a significant amount of supply in that area, as was seen at the beginning of the year. I believe that the market needed to pull back anyway, it had gotten ahead of itself.
Christopher Lewis
USD/JPY weekly chart, July 23, 2018

The US dollar has enjoyed a nice run higher against the Japanese yen during most of the year. However, we ran into a major resistance barrier in the form of the ¥113 level, which I believe extends to the ¥115 level. I do believe we eventually go higher but being a bit overextended means that we needed to pull back to find enough value hunting to turn this market around. I think that somewhere near the ¥111 level we will find more buyers, and I would fully anticipate value hunters to come back in.

The alternate scenario is that we break above the top of the candle for the week, and that I think we continue to grind towards the ¥114.50 level, and then the ¥115 level. It’s going to take a lot of work to get up there though, and therefore I think it will take a lot of patience. However, the interest rate differential between the two economies is very clear-cut, as the Federal Reserve looks to continue to raise interest rates, despite what Donald Trump said on Friday, and therefore I think that once the smoke clears traders will be looking to pick up the value that is presenting itself as I watch this market on Friday. I think that the Bank of Japan is several years away from trying to normalize rates, so there’s no need to panic, simply look for value, a bounce, and then take advantage of it.

USD/JPY Video 23.07.18

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US