USD/JPY Forecast: USD Continues to Climb Against JPY – 23 August 2022
We have no interest in trying to short this market because it is far too strong.
If we pull back from here, it’s likely that we only get an opportunity to start buying this market yet again. It’s also worth noting that the market has recently formed a “W pattern”, which is a bullish sign, and therefore it’s likely that we could continue to go much higher.
Underneath, we have the 50-Day EMA rising, and therefore it’s likely that we will continue to see that offer a little bit of dynamic support. I do think that given enough time the US dollar will reach the ?140 level, and it’s probably worth noting that the previously mentioned “W pattern” does measure for a move to that level. It’s also worth noting that there have been several green candlesticks in a row, and I think that it is probably only a matter of time before we get a pullback, but that pullback should be thought of as value. I have no interest in trying to short this market because it is far too strong.
The “floor in the market” is probably close to the ?132 level, which is the bottom of that “W pattern”, so a breakdown below that level would attract a certain amount of attention. In that scenario, things could get somewhat ugly, opening up a drop to the 200 Day EMA. The 200 Day EMA sits just below the ?128 level, so that should be something to keep an eye on as well, as the market has seen so much in the way of reaction to that area previously. If we break it down below there, then it’s likely that the market goes down to the ?120 level. We are in a longer-term uptrend, and therefore you need to keep that in the back of your mind as we have seen so much in the way of momentum.
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