USD/JPY Forecast: USD Trying To Show Stability Against Yen
The US dollar has initially fallen a bit during the trading session on testing the ¥130 level and even break down below there slightly. However, the USD/JPY pair turned around to show signs of life again, forming a bit of a hammer. At this point, we have asked whether the ¥130 level is to continue to be supportive, and perhaps the market could turn around the general vicinity. We know that there is a job number coming out on Friday that could have a major influence on where we go next, so we are most certainly in an area that could come into the picture.
USD/JPY Today's Predictions
- I would not be surprised at all to see this market recover in the short term, because quite frankly the US dollar has done the same thing across the board.
- The 200-Day EMA is close to the ¥135 level, so I think that offers a short-term barrier.
- The sellers could come into this market and that general vicinity.
- However, if we were to break above there, then it’s likely that we could go to the 50-Day EMA.
When you look at the chart, you can see that we are forming a bit of a downtrend channel, so a break above the 200-Day EMA could be a break above the potential channel, perhaps opening up the possibility of a move much higher. That would continue the overall uptrend from the long term, but it will be interesting to see whether or not we can get any follow-through on a move to the upside. That being said, if we break down below the 130 level, then you could see this market drop down to the ¥127.50 level, perhaps even as low as the ¥125 level.
Ultimately, this is a market that I think will see a lot of volatility over the next several sessions, and I think we are more likely than not going to continue to see a lot of hesitation, but by the end of the week I anticipate that the volume will pick up enough that we will see the “true move”, and therefore a bit of follow-through. It’s possible that the next couple of days may be more noise than anything else, but I certainly think we are getting close to some type of resolution.
(Click on image to enlarge)
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