USD/JPY Weekly Price Forecast – US Dollar Gives Back Gains for the Week

The US dollar has rallied a bit against the Japanese yen during the course of the trading week, to reach towards the ¥114 level. That being said, it certainly looks as if we are going to continue to see a lot of noisy behavior heading into the end of the year. Keep in mind that the ¥112.50 level is an area that will continue to attract a lot of attention, as the area has been tested a couple of times. Furthermore, it is worth noting that the ¥115 level above is even more important, as it has been a major resistance point multiple times over the last several years. Breaking above that barrier will certainly catch the attention of traders around the world, signifying that a longer-term “buy-and-hold” situation will be presenting itself.

USD/JPY Video 13.12.21

If we were to break down below the ¥112.50 level, then it is very likely that this market goes looking towards the ¥110 level, where there is a lot of structural and psychological support. The 50 week EMA just broke above there, so it does more likely than not offer a bit of a barrier as well. As we go into the end of the year, it is very likely we will continue to see more chop than anything else, which is typical of markets that are struggling with liquidity. Ultimately, this is a market that I think will continue to see a lot of risk appetite expressed back and forth, and therefore caution with your position size will be crucial over the next several weeks.

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