USD/JPY Weekly Price Forecast – US Dollar Continues to Grind Higher Against the Yen

USD/JPY Weekly Technical Analysis

The US dollar has been fairly quiet against the Japanese yen during the course of the trading week, as we are threatening the 150 yen level. This is an area that obviously is a large round psychologically significant figure and will almost certainly have a lot of options barriers. Short term pullbacks have been bought into though and I think given enough time, we probably continue to see buyers jump in and try to take advantage of value.

Ultimately, this is a market that if we can get above the 150 yen level, then we could see this market really start to take off towards the 152 yen level. Anything above there then opens up the possibility of a move to the 155 yen level. Short-term pullbacks could drop all the way to the 145 yen level and still see plenty of support and, furthermore, still be, technically at least, an uptrend.

There is a major trend line that would dissect right around the 143 yen level, so we’ll have to pay close attention to that. The interest rate differential continues to favor the US dollar and will for the foreseeable future, especially as the Bank of Japan has recently just admitted that they can do nothing to tighten monetary policy, and therefore, I think you’ve got a situation where, given enough time, traders will start to focus on the carry trade again.

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