USD/JPY Price forecast for the week of February 12, 2018, Technical Analysis

Although it was a bit choppy this past week, when you zoom out on the weekly chart you can see that the USD/JPY pair is very clearly still in consolidation. As we are towards the bottom of the consolidation, it makes sense that buyers start to show up again. · FX Empire

Christopher Lewis

Updated Fri, Feb 9, 2018, 10:00 PM

The US dollar had a negative week against the Japanese yen as the 110 level has offered resistance. When you zoom out and look at the weekly chart, you can see that we have been consolidating for well over a year. Although it has been a bit difficult over the last couple of weeks, we are still well within that range. In fact, it’s not until we break down below the 107.50 level that I think anything has changed. Right now, it looks as if the market is trying to find some type of base, and on a daily close above the 110 level, I would anticipate the buyers will come jumping back in and trying to push this market towards 114 above.

As this pair tends to be very susceptible to risk appetite, I find it encouraging that even with a massive selloff that we have seen in the US stock markets over the last several sessions, this pair has remained relatively stable. That tells me that there is an underlying strength when it comes to the USD/JPY pair, and that we should see bullish pressure as soon as the markets calm down in other financial sectors. Because of this, I remain hopeful, but recognize that a lot of patience will probably be needed. Once things stabilize in the S&P 500, I suspect that this pair will start to rally again and reach towards the top of the turquoise box that I have on the chart.