USD/JPY Price Forecast – US dollar falls against yen to close out the week

This pair is highly sensitive to risk appetite in headlines, especially when it comes to the US and China. Since there’s been so much to talk about lately, it’s not a huge surprise that this market may have fallen. I think that the US dollar had gotten a bit overbought in general, and we are starting to see a little bit of the selloff here. However, if we can ever get back to interest rate differential being the main driver of markets, this pair should turn right back around.

I think that the ¥110 level is supportive, but even more so would be the ¥109 level. In fact, the more I look at this chart the more I realize that we may be entering a consolidation area between ¥109 on the bottom, and ¥111 on the top, making the ¥110 level “fair value.”

If that’s the case, that expect more choppy sideways trading and don’t expect to get clarity anytime soon. This is a market that favors short-term scalping currently, and I would look at it as somewhat range bound but maybe with a slightly negative tilt. Using something along the lines of the stochastic oscillator may help, but overall I think that there are going to be much easier markets to trade right now. All things being equal though, it looks as if the US dollar is going to fall a bit going into this week, unless of course news changes.

USD/JPY Video 20.08.18

This article was originally posted on FX Empire

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