USD/JPY Price Forecast – US dollar pressing resistance

The US dollar has rallied a bit during the trading session on Wednesday, reaching towards the 50% Fibonacci retracement level, and perhaps more importantly the 200 day EMA above there. The 200 day EMA of course will cause a certain amount of resistance, as it is a large indication of trend in general. If we can break above there, then the market is very likely to go much higher. That of course would be thought of as a trend change by certain algorithms, so therefore could bring a lot of money into the marketplace.

USD/JPY Video 02.10.19

To the downside, I see the 50 day EMA which is painted in red on the chart as an area that people will be paying attention to as well. It is starting to turn higher though, so that does give a little bit more credence to the idea of breaking out. It’s a little early to call that yet, but certainly is something that we should be paying attention to. Beyond that, keep in mind that the pair is highly risk sensitive, so therefore paying attention to stock markets may make quite a bit of sense. If that’s going to be the case, then expect the S&P 500 to be a decent secondary indicator as to where this pair goes next. Ultimately, as it rallies, the Japanese yen get sold off, driving this market higher. Obviously, the exact opposite is true. I suspect we get a bit of choppiness in this general vicinity but it certainly looks as if the buyers are trying to press the issue.

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