USD/JPY Price Forecast – US Dollar Continues To Struggle

The US dollar has initially tried to rally during the trading session on Monday but gave back the gains as people have continue to sell the greenback against almost everything. Ultimately, the ¥104 level has offered too much in the way of resistance, as it continues to be an area of influence in this market. However, we have broken below the support level over the last couple of weeks, and therefore it suggests that we are starting to get ready to continue going even lower. For what it is worth, the USD/CAD pair tends to attract this market quite well, and it is breaking down rather significantly as well.

USD/JPY Video 15.12.20

To the upside, the 50 day EMA is offering resistance, and therefore fading short-term rallies will continue to be opportunities to start selling again. To the downside I believe that the ¥103.25 level will be tested, and if it gets broken through, the market then started looking towards the ¥102 level over the longer term. I have no interest in trying to buy this pair, because quite frankly it looks as if the longer-term trend is fairly ensconced, and with the budgetary negotiations in the United States as well as coronavirus relief packages, it does make sense that we will continue to see this downward pressure.

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While the pair does tend to rally a bit based upon risk appetite, quite frankly that is being completely ignored, and therefore it is all about the stimulus coming out of the United States. I do believe that the market has far too many areas above that could cause resistance so therefore this is a “sell on the rallies” market.

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