USD/JPY Price Forecast March 14, 2018, Technical Analysis

The US dollar has rallied significantly against the Japanese yen during the trading session on Tuesday, reaching as high as 107.25 before I recorded this. We are pulling back slightly, but I think that there are buyers underneath willing to push to the upside. If we can break above the 107.50 level, the market could extend gains to the 110 level over the longer term. Recently, we have been making “higher highs”, and therefore it looks like we are trying to build up the necessary momentum to finally break out. Because of this, I don’t have any interest in shorting this market, as it looks like the USD/JPY is trying to form some type of basing pattern.

At this point, I anticipate a breakout of the next couple of sessions and think that it’s only a matter of time before that happens. When it does, we could see a significant move. On the other hand, if we were to break down below the 106 handle, then it would be very negative, and I think that the pair could fall apart to the 105 level. With the CPI numbers coming out as expected in the United States, the market has been reacting in a “risk on” attitude in other pairs, and I feel it’s only a matter of time before that follows here.

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