USD/JPY Weekly Forecast – US Dollar Plummets Against the Yen

USD/JPY Forecast Video for 16.01.23

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has sold off aggressively against the Japanese yen during the week, after initially trying to take off to the upside. At this point, it’s worth pointing out that the market is threatening the ¥127 area, which is an area that seems to be an important cluster. If we were to break down through this area, it could open up the trap door to much lower prices. In fact, we could see another 1000 pips on that breakdown.

On the other hand, if we do bounce from here, and it is very possible, I think that sellers will be waiting for the first signs of trouble. Keep in mind that the Japanese yield curve control is starting to crumble, and if that’s going to be the case, the Japanese yen will be the strongest currency out there due to the fact that there is a lot all catch up to do in the bond market. With that being said, I would anticipate a lot of noisy behavior by I would also anticipate that the bounce that comes could be rather brutal.

After all, we have fallen straight back down. You will have to keep an eye on the 10 year yields coming out of Japan, because there is supposed to be a ceiling at the 50 basis points level. It has been pierced once or twice, so you have to worry about that as well. Ultimately, I think this is a situation where you have a bit of a certain amount of fear in the market, but I do think that if we can start looking for bounces to take advantage of.

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