USD/JPY Forecast – US Dollar Continues to Fall Against The Japanese Yen

US Dollar vs Japanese Yen Technical Analysis

The US dollar has fallen against the Japanese yen during the early hours on Friday to break down below the 142 yen level and is now threatening a major uptrend line. Quite frankly, I think the next couple of days will determine what happens with this pair in the longer term. The US dollar has of course been hammered against the Japanese yen and other currencies.

And like I said, right now we are looking at a market that is doing everything it can to really start to break down the overall uptrend line. If we continue to drop from here and looking at the weekly chart, I believe it’s below the 140.50-ish area, then we could drop pretty significantly in that environment. And in fact, we could be looking at a move back down to the 131 yen level.

A bounce from here on the other hand though, could be a beautiful opportunity to get long again. Remember that the Bank of Japan can only raise interest rates so far. And while the, uh, Federal Reserve is likely to cut rates, it can only do so much so quickly, uh, because of inflation. And in fact, inflationary numbers are starting to be a little hotter than expected again. So that of course causes some issues. I do think that we’re going to see a lot of volatility, but eventually we’ll get a long and pulsive candle that will tell us which direction to go. Above 145 yen, I’d be bullish. Below 140 yen, I’d be bearish.

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