US Dollar vs Japanese Yen Weekly Technical Analysis
The US dollar has rallied again during the week against the Japanese yen, as we continue to see plenty of upward pressure. In fact, both Thursday and Friday fell, but found buyers willing to pick this market back up. It does not seem to be any real selling pressure of significance, but if you are a longer-term trader you need to find some in order to get a little bit of value. That being said, you certainly would not short this market, even if you knew that it was going to fall next week.
The Bank of Japan continues to flood the market with yen, as they are fighting to keep the 10-year JGB note yielding 25 basis points or less. They have already committed to “buy unlimited amounts” in order to keep this from occurring. Sooner or later, the Bank of Japan will find itself in a situation where they need to either stop this, or give up on the currency altogether. They cannot have it both ways, and therefore something is about to break.
If things stay the way they are, we could see a real massive melt-up in this pair. This is because not only do you have a situation where the Japanese are destroying their own currency, the Federal Reserve got inflationary numbers during the Friday session they guarantee that they will have to remain hawkish for quite some time. As long as that divergence is in place, there’s a really good chance that we go much higher in this pair and each dip should be thought of as a potential opportunity to get long again.
USD/JPY Price Forecast Video 13.06.22
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This article was originally posted on FX Empire
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