USD/JPY Price Forecast – US dollar pulls back to end the week
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The US dollar has pulled back a bit during the trading session on Friday, breaking through the ¥111 level, reaching down towards the ¥110.50 level. Looking at this market, I think there is plenty of support not only there, but there’s probably even more support at the ¥110 level. Otherwise, if we turned around and broke above the ¥111 level, the market should then go looking towards the 100 level ¥0.50 level, and then the highs again. I believe that eventually we will go looking towards ¥112 level, but I also believe that this market will be very heavily influenced by the Sino-American negotiations, which of course have been noisy as of late.
The better the negotiations go, the better off this pair will be. At that point, we can start to think about the fundamentals, specifically the interest rate differential. At this point, it seems very unlikely that things are going to change in the short term, so that will continue to put a bit of an anchor around the neck of this pair, but I am bullish longer-term. I believe that the ¥110 level will be very difficult to break through, but if we do that would of course be very negative sign. Short-term trading is probably going to continue to be the best way to play this market, as we can’t get any traction in one direction or the other. However, eventually things return to normal in this pair should be a good place to be.
USD/JPY Video 03.09.18
This article was originally posted on FX Empire