USD/JPY Price forecast for the week of November 20, 2017, Technical Analysis

The US dollar fell after initially trying to rally against the Japanese yen during the week. By rolling over and testing the 112 level, we are at a critical juncture in this pair, as a move below that level could send this market down to the 108-level next. This market has rallied significantly, but a breakdown below this level signifies that we are very much still in consolidation, as we have been most of the year. A turnaround at the 112 level is necessary for any attempt to break out to the upside, which has a lot to deal with in the form of the 115 handle.

I don’t believe that the US dollar will break down below the 108 handle, but rather bounce from there as it has been so stringent this year. I think that a lot of the negativity in the US dollar is due to the lack of a tax bill coming out of the United States Congress, and that of course continues to weigh heavily upon the greenback. I think that they will get it done eventually though, especially by the time of the year and, as seems to be a mandate due to political considerations. At that point, expect a rally in this pair, and perhaps even the ability to finally break above the 115 handle. Until then, it is going to continue to be very choppy, and possibly dangerous to trade this market with any type of size. The fact that we are closing towards the bottom of the candle suggests that the selling pressure is picking up, not abating. If this is true, we should be a will find value at lower levels by simply waiting for the right headlines across the wire.

USD/JPY Video 20.11.17