USD/JPY Price Forecast – US Dollar Gets Tests 50 Day EMA

The US dollar has fallen rather hard during the course of the trading session on Friday, mainly in response to the less than enthusiastic jobs number that came out of the United States. Initially anticipated being roughly 1 million jobs added for the last month, the real reading was a bit over 200,000 which of course is not enough to make people feel good. Remember, this is a risk sensitive currency pair, and therefore it is worth paying attention to these types of things. Furthermore, the market is likely to see the bond market tell it where to go next.

USD/JPY Video 10.05.21

At this point in time, the market is likely to see the ¥108 level as a supportive area, where we have seen a couple of hammers, and of course the 38.2% Fibonacci retracement level. Ultimately, this is a market that I think continues to be noisy and based upon yields in both countries, does favor the US dollar still. However, yields of course did drop after the jobs figure so this is part of what caused the effect that we saw early in the session.

All things being equal, I think that what we are looking at is a market that is trying to get back to the ¥109 level, and it will not surprise me at all if we end up back there by the time, we close out business for the weekend. Ultimately, this is a market that I am still a buyer of, at least until we break down below this hammers near ¥108 underneath. The 50 day EMA has served as a perfect support level from the initial knee-jerk reaction.

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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