USD/JPY Forecast – US Dollar Continues to Look For The Floor Against Yen

US Dollar vs Japanese Yen Technical Analysis

The US dollar is in the process of doing everything it can to stabilize as market participants continue to see a lot of noisy behavior. And I do think that we have a situation where the 145 yen level is acting as a bit of a fulcrum for price. Whether or not we can find support here remains to be seen, but if we do bounce from here, that’s yet another sign that we are doing everything we can to stop the selling.

Keep in mind that the Federal Reserve is expected to cut rates several times, and that of course has a somewhat significant influence on this market, but at the same time, the Japanese cannot tighten monetary policy too much because of the massive amounts of debt that the Japanese economy is currently suffering under. So, with all of that being said, this is a scenario where traders are going to have to be cautious.

Perhaps try to take advantage of any momentum as it comes, but as long as we can stay above the 142 yen level, I still think it’s probably going to be a bit of a bottoming process. If we were to break down below there, then the bottom probably falls out.

You do get paid to hang on to this every night, and after the first Federal Reserve rate cut, you will still get paid to hang on to this at the end of every night. So that is something worth paying attention to, as traders, like I said, probably have priced in way too much for interest rate cuts because, quite frankly, if they have, that means we’re going to have a lot of problems in the financial markets, not just here.

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