USD/JPY Price Forecast – US dollar sideways for the Wednesday session

The US dollar continues to show weakness against the Japanese yen and a miss for the CPI figures out of America didn’t help the situation either. It looks as if the ¥112 level underneath should offer support though, so I think it is only a matter of time before we see a bit of a bounce. The recent selloff has been exacerbated by the bloodletting on Wall Street during Tuesday. · FX Empire

Christopher Lewis

Updated Thu, Oct 11, 2018, 9:09 PM

The US dollar has fallen rather sharply against the Japanese yen over the last couple of days as Wall Street continues to get pummeled. However, the ¥112 level looks to be rather supportive. I think at this point we are overdue for a bit of a bounce, and that could send this market towards the ¥113 level. That’s an area that will offer a significant amount of supply, but I do think that we could break above there if we can get good news on Wall Street. I think that most Wall Street traders are a bit cautious right now, and that will have a bit of a knock on effect in risk appetite. Because of this I am a bit cautious about putting too much money to work in one shot, but I also recognize that we are oversold. We have been in and uptrend for some time, so I don’t think the sellers will overwhelm the market for much longer.

Expect a lot of volatility, but the pullback has been strong enough that I think value hunters are starting to come back into the marketplace and will take advantage of this dip. I would start out slow though, as headlines continue to rock the markets back and forth. Ultimately, I think the ¥114.50 level will be the target.