USD/JPY Weekly Price Forecast – US dollar rallies again

The US dollar rallied again during the week against the Japanese yen, as we continue to meander around the ¥110 level overall. That’s essentially “fair price” right now, so I think that the market is stuck in a sideways consolidation pattern, waiting for some type of guidance. · FX Empire

Christopher Lewis

Updated Fri, Jun 29, 2018, 9:15 PM

The US dollar has been bullish during the week against the Japanese yen, especially on Friday as we got word that the Europeans had come together with an initial agreement when it comes to migration, a sticking point in that region. I think that eventually the market will eventually find some type of solace in that, but we also have several other things move in the marketplace is right now. Because of this, I think that the rally based upon the European Union is short-lived at best.

The pair of course is very sensitive to risk appetite, and as long as we can stay in a relatively healthy environment, it’s likely that we will eventually overtake the ¥111 level and continue to go higher. If we can do that, ¥114 would be the longer-term target. Currently, the 190 and level looks to be support, and I think if we can stay above there we will eventually find reasons to break out to the upside. However, if we break down below that level, it’s likely we would drain down to the ¥107.50 level, which is also supported.

All things being equal, I preferred the upside, but I recognize that we would need to focus on the fundamentals, and other words the interest rate differential and the interest rate outlook for both countries to do so. Right now, there is far too much in the way of noise around the world crossing the headlines for the markets actually do that.