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

US Dollar vs Japanese Yen Technical Analysis

The dollar has taken it on the chin again against the Japanese yen and I think at this point we could probably start to pay attention to the 152 yen level, seeing if it ends up being an area where we bounce from. The 200 day EMA sits there and of course there is a lot of market memory there as well due to the fact that the market had previously been massive resistance. All things being equal, this is still a carry trade pair but there have been mumblings again overnight that perhaps the Bank of Japan has intervened. They’re doing everything they can to drive down the value against the dollar against the yen or really for that matter just trying to save the yen.

But sooner or later this ends and the market goes back to what it was doing. I think at this point, you need to be very cautious. You need to be very patient. Shorting this pair is not the way to go at this point. Now, if the Fed starts cutting, maybe you can make that argument, but right now you just don’t have it. Ultimately, it’s about sitting on your hands and waiting for the opportunity.

As things stand right now, we don’t see a situation where we are just jumping in. If we were to turn around and recapture the 155 yen level, then possibly that’s a buying opportunity as well. But I would prefer to see it come back a little bit. Give me a little bit more value in the green bag before I jump in and start putting money to work.

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