USD/JPY Forecast – US Dollar Finds Support

US Dollar vs Japanese Yen Technical Analysis

The U.S. Dollar has pulled back a bit against the Japanese Yen in early trading on Friday, but the jobs number came out just a touch hotter than anticipated, at least on the headline number. So it’s not a huge surprise to see that the market has turned around after selling off. And it looks like it’s going to continue to look at the 160 yen level as important. With that being the case, I think you’ve got a situation where the market is going to continue to be bullish overall. And of course, the interest rate differential between the two economies will continue to be a major factor here.

With this, I anticipate that we do eventually go looking towards the highs again, but I also recognize that we are in the middle of summer and liquidity can be a bit of an issue. If we were to break down below the 160 yen level, that could cause some negativity, but really at this point in time, I think you’ve got a situation where you have to assume that sooner or later, the market participants are going to have to come to some type of consensus.

We might be just digesting some of these gains, but I still favor the upside because of course, you get paid at the end of every day and that is something that you need to be very cognizant of. Even if we break down below 160 yen, the 50 day EMA comes into the picture near the 157.75 level, and then we have multiple other areas underneath there. I’m a buyer and I do believe we go higher.

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