USD/JPY Weekly Price Forecast – US dollar struggles for the week
The US dollar has gapped lower to kick off the week and then reached down towards the 109.70 level by the time mid Friday came around. That being the case, it looks as if the market is trying to hedge its bets ahead of any announcement between the Americans and the Chinese, which at this point could go in either direction. With that in mind, I will offer analysis for both scenarios, as we have no idea when any type of news will come out.
USD/JPY Video 13.05.19
Basically, the way the markets behave for the next candle is going to be more or less a coin toss. If we break down below the ¥109 level, it’s very likely that we will go looking towards the ¥108 level. This will probably coincide with bad news out of the trade talks, as the Japanese yen will be the safety currency of choice in that scenario. Having said that, there’s also the opposite scenario where the talks produce something substantial, and if they do it’s likely that we could fill the gap above.
Your capital is at risk
Unfortunately, this is a market that is going to be difficult to get a grip on ahead of time, because this is literally going to come down to two things: what the announcement says from the US/China trade talks, and what the market thinks about it. One thing you should make sure that you do is keep your risk under control, meaning keep your position size relatively small as we could see extreme moves and quite suddenly.
Please let us know what you think in the comments below