USD/JPY Forecast – US Dollar Continues to Grind Against The Yen
US Dollar vs Japanese Yen Technical Analysis
The US dollar has pulled back slightly against the Japanese yen during the trading session on Monday as traders continue to look at this through the prism of trying to find value. Ultimately, we are near the recent highs at 152 yen, and I do think that ends up being very important.
With that being the case, I like the idea of taking advantage of short-term pullbacks. I think clearly this is a market that will eventually do what it can to break out to the upside, but that doesn’t mean it happens overnight. Quite frankly, this is a scenario where traders will continue to look at this through the prism of whether or not we can stick above the 152 yen level.
If and when we can, and I do believe that happens sooner or later, the US dollar is likely to go looking to the 155 yen level. The 155 yen level is a large round, psychologically significant figure that people will pay attention to. Underneath, we have quite a bit of support near the 150 yen level and again at the 50-day EMA.
Keep in mind that the interest rate differential between the two central banks will continue to be a crucial driver of where we go and therefore, I think ultimately this is a scenario where you’re just taking advantage of getting paid at the end of every session. With all of that being said, I don’t have any interest in shorting this pair and I look at every pullback as a potential buying opportunity as well as a breakout above the crucial 152 yen level.
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This article was originally posted on FX Empire
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