USD/JPY Forecast – US Dollar Continues to Find Support

US Dollar vs Japanese Yen Technical Analysis

The U.S. Dollar has rallied a bit against the Japanese yen during trading on Thursday, ironically just after the Federal Reserve cut rates 50 basis points. We do have the Bank of Japan interest rate decision on Friday, and that will obviously have a major influence on what happens next. So, I do think that this is a pair that continues to be very noisy. For what it is worth, we are well above the 142 yen level, and therefore I think a certain amount of buying comes back into the market regardless.

The next major barrier is going to come in the form of the 145 yen level, where I think a lot of people will be looking to perhaps try to short this market again. That being said, it does look like we are changing the overall attitude of the market and it’s very possible that we may continue to see buyers jump in on each and every dip.

It’s worth noting that the 140 yen level has offered significant support and that of course is something that I had mentioned previously as being important due to the fact that it was a major support level in the past. The oversold condition of the pair eventually has to correct itself so that might be what we’re seeing but, in the meantime, I also recognize that this is a market that’s going to be very noisy, so I don’t want to put a huge position on.

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