USD/JPY Forecast – US Dollar Continues to Grind Higher Against The Yen

US Dollar vs Japanese Yen Technical Analysis

The US dollar rallied somewhat significantly during the early hours on Wednesday as we continue to see traders look at the interest rate differential as a reason to get involved to the upside. In general, I think this is a situation where you have a lot of noise, but I do think that any type of pullback offers you the opportunity to find a little bit of value. With that being the case, the market is going to continue to be one that I believe monitors any move towards the 160 yen level as a potential opportunity, mainly due to the fact that we have seen that as the area where the Bank of Japan intervened and has since failed to protect.

So, with that, I like buying dips going forward and I do believe that it is probably only a matter of time before we see buyers take advantage of any dip. The 162.50 yen level is probably going to be a potential short-term target, but I do think that this is going to be more of a grind than anything else.

Furthermore, keep in mind that the market will have to take into account that the Independence Day holiday is on Thursday and that of course has a huge influence on liquidity. We also have the jobs number on Friday and that tends to throw this pair around as well. That being said, this is a market that has plenty of interest in it so I do think we will continue to go higher.

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