USD/JPY Weekly Price Forecast – US dollar struggles

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Updated: Feb 22, 2019, 17:16 UTC

The US dollar struggle during the week, initially trying to go higher but not being able to break above the top of the previous week candle. With this being the case, and the fact that we are at the 61.8% Fibonacci retracement level from the selloff, it looks very likely that we could roll over.

The US dollar has rallied quite nicely over the last couple of months against the Japanese yen, but with the Federal Reserve looking very soft, and the possibility of the stock market in America topping out a bit, we could get a pullback. I doesn’t necessarily mean that I think the market is going to melt down, just that we will probably start to roll over at this point. Beyond that, the ¥110 level is offering a little bit of support, but if it is broken that’ll be your signal.

USD/JPY Video 25.02.19

To the downside, I believe that the ¥108.50 level is going to be targeted, but at this point it probably will be more of a grind to the downside. To the upside I see a lot of resistance at the ¥111.50 level. Overall, this is a market that I think is getting a bit overextended as seen by the very quiet candlesticks during the sessions that made up this week, and of course the fact that the Federal Reserve is going to continue to be soft with its monetary policy. Looking at this market, it’s very likely that we see a lot of noise based upon the S&P 500 and the trade talks between the Americans and Chinese, so it’s very likely that there will be some type of disappointment to drive this pair back towards the yen anyway.

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About the Author

Christopher Lewisauthor

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.