USD/JPY Forecast Today 14/04: Bounces After Selloff (Chart)

(MENAFN- Daily Forex)

• During the trading session on Friday, the US dollar initially plunged against the Japanese yen, but we have seen a nice bounce, from the crucial ¥142 level.
• This is an area that's been important multiple times in the past, so it would not surprise me at all to see the beginning of something along the lines of a turnaround in this area.
• Ultimately, the candlestick for the day looks like it's going to be a bit of a hammer, although not a perfect one as the“head of the hammer” might be a little bigger than most people would like.

Technical Analysis

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The technical analysis for this USD/JPY pair is extraordinarily negative, and I do recognize that although the interest rate differential continues to favor the US dollar, especially as bonds in America selloff, sometimes higher interest rates can be a bad thing. I think we are in one of those times right now, but if we do get some type of stability in the markets, that will probably turn this market right back around, sending the US dollar much higher against the Japanese yen.

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If we were to break down below the ¥142 level, then I think it opens up the possibility of a move down to the 140 in level, which is a large, round, psychologically significant figure, and an area that historically speaking, has been important. On the other hand, if we can recapture the ¥145 level to the upside, then I think the US dollar starts to rally toward the crucial ¥148 level, an area that had been a massive barrier multiple times in the recent past. Regardless, I do think that we will see a fairly big move, and it might also be worth noting that the Friday session was when we saw a bit of a bounce, perhaps traders are a bit concerned about trying to hang onto a short trade heading into the weekend.

EURUSD Chart by TradingView

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