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USD/JPY Weekly Price Forecast – US Dollar Continues to Find Buyers

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar initially fell significantly during the course of the trading week to reach the 155 yen level before bouncing quite drastically. It’s probably worth noting that Friday had a jobs number that was much stronger than anticipated. And therefore, people will continue to look at it through the prism of interest rate differential and the fact that the Federal Reserve is very unlikely to loosen monetary policy anytime soon. I think at this point, any short-term pullback is a nice buying opportunity.

And if we break down below the bottom of the candlestick, then the 152 yen level is an area that previously had been resistance. So market memory should come back into the picture. In general, I think this is a market that every time it falls, you look for value, the interest rate differential gets you paid at the end of every day and institutional traders will continue to pay close attention to it.

I would not be interested in shorting this pair anytime soon and the market would have to break down below at least 150 yen for me to get involved to the downside and even then, you have to be somewhat cautious due to the fact that you have to pay the swap at the end of the day. So with this I remain bullish. I think eventually we break above the 158 yen level and then go towards the 160 yen level where there’s a huge battleground just waiting to happen.

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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