USD/JPY Price Forecast – US dollar choppy on Friday

The US dollar could bounce from here, but I think that the ¥109 level above should offer resistance as it is the 50% Fibonacci retracement level of the massive break down, and above there you can see that I have circled on the chart that we have made a “death cross”, which is one of the 50 day EMA crosses below the 200 day EMA. That’s a technically bearish sign.

USD/JPY Video 14.01.19

The massive negative candle that extended all the way down to the ¥105 level shows you just how much technical damage has been done. I think at this point if we can break down below the ¥108 level and close below there, then we could go down to the ¥107 level after that. This is a minor support level, but I think we will try to go all the way down to the ¥105 level eventually. All that would take is some type of negativity out there, or a continuation of US dollar selling in general. This is a market that is very risk sensitive, so pay attention to the stock markets, because of a meltdown again that could send this market lower. I don’t have a scenario in which I’m comfortable buying this pair currently, and if I did decide to go against the Japanese yen it would probably be with the Australian dollar which looks as if it is trying to pick up a bit of strength.

This article was originally posted on FX Empire

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