USD/JPY Weekly Price Forecast – US Dollar Continues to Grind to The Upside

US Dollar vs Japanese Yen Weekly Technical Analysis

Taking a look at the U.S. dollar against the Japanese yen, you can see that we have rallied significantly during the course of the trading week as the 147.33 level continues to offer support. With that being said, I think you need to look at this through the prism of buying every dip you get an opportunity to, mainly because I think it’s probably only a matter of time before we break out. When that happens is a bit of a guess at best, but it certainly seems as if it will happen given enough time. Patience will be key here in this market.

Keep in mind that the Bank of Japan has zero chance of raising rates significantly. They may raise them to zero, but at the same time, the Federal Reserve, even though they will cut later this year, continues to have relatively restrictive monetary policy, putting upward pressure on the dollar anyway. Remember, you get paid to hang on to this currency pair at the end of every day via swap and your institutional traders and firms will of course continue to take advantage of this as an investment.

You can make an ascending triangle of sorts so it does indicate more pressure as well. So, I like buying dips. If we can break above the 152 yen level, then I think we can go much higher, possibly even as high as 155 yen, maybe even 157 yen over the longer-term move. I have no interest in trying to short this market, as it is expensive to finance to the downside.

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This article was originally posted on FX Empire