USD/JPY Weekly Price Forecast – US Dollar Has Wild Week Against Japanese Yen

The US dollar broke down towards the ¥101 level, and then turned around to bounce towards the ¥107 level. At this point, the market has formed some type of massive hammer, but at this point I think short-term pullbacks will probably be bought into, unless of course we get some type of panic again, which could send this market back towards the Japanese yen. All things being equal, the market is probably waiting to see whether or not the Federal Reserve is going to get involved next week, and of course whether or not the United States government is going to do something.

USD/JPY Video 16.03.20

Looking at this candlestick, it’s obvious that we will continue to see a lot of trouble, but I think that if we rally from here it’s likely that the ¥110 level offers resistance. From a longer-term standpoint, it’s very difficult to hold on to this type of volatility so therefore if you are going to go looking towards the Japanese yen, you probably need to do so with another currency against it. The ¥100 level underneath will be the “hard floor” in the market, so if the market breaks down below there, then the Bank of Japan would more than likely get involved. All things being equal, the market is likely to see a lot of noise and therefore you should keep your position size small. In fact, that is probably the most important thing that you can do, as the volatility could wipe you out. There is a bit of a gap just above, but it has been filled so whether or not it’s going to hold is a real question.