USD/JPY Forecast – US Dollar Continues to Recover Against the Japanese Yen

USD/JPY Forecast Video for 25.01.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar initially fell during the trading session on Tuesday, piercing the ¥130 level. However, traders have a jumped back into this market to try to support the US dollar, which makes a certain amount of sense considering that the Bank of Japan has decided to do everything he can to keep interest rates at or below 50 basis points in the 10 year note. In other words, they may be forced to buy “unlimited bonds”, meaning they would have to also print unlimited yen.

In this environment, I think we are trying to turn things around, and if we can break above the inverted hammer of Wednesday from last week, that for me is a signal that this market goes much higher. We are most certainly trying to do so, and the fact that the ¥130 level has attracted more buyers does suggest that might possibly be the case. Either way, I would anticipate a lot of noisy and choppy behavior, but that’s nothing new for this pair. We have seen a massive pullback of what had been an impulsive and parabolic market.

If you look back at some of my analysis a couple of months ago, I suggested that perhaps the pullback in this pair could be brutal, just because the move had been so parabolic and one directional. Because of this, we now have to have the courage to step in and perhaps buy this pair if it’s the right time. It’s getting close, and I do think that this is one of the pairs out there worth paying close attention to.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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