USD/JPY Price Forecast – US dollar rallies to kick off week

The US dollar pulled back initially during the trading session on Monday but bounced from the uptrend line that we have had for some time, showing signs of resiliency in the uptrend. If we can rally from here, it’s very likely that we could go looking towards the ¥114 level above. Ultimately, that is an area that begins a lot of resistance that extends towards the ¥115 level. I think that the markets are essentially in a “wait and see” attitude, meaning that there are far too many moving issues out there right now to be comfortable holding onto a position for the longer-term.

USD/JPY Video 11.12.18

Beyond that, we are getting close to the end of the year and a lot of liquidity will be drained out of the market in the next couple of weeks. Most traders are looking to book profits at the end of the year, simply trying to pad books for clients. It is because of this that I think it’s going to be very difficult to break above the ¥115 level between now and New Year’s Day. However, if we do break above there then obviously it’s a very bullish sign. Otherwise, if we pull back through the trend line, and the ¥112 level, which coincidentally would also be a break down below the 200 day EMA, then I think the sellers would take over and push down towards the ¥110 level, perhaps even the ¥108 level. Ultimately, I think the one thing you can count on is a lot of choppiness but I think we remain range bound for the next couple of weeks.