USD/JPY Forecast 04/02:USD Struggles At Important Indicator

(MENAFN- Daily Forex) I look at this market as one that could offer opportunities on dips, but it will also be very noisy and rocky to say the least/JPY

The US dollar has gone back and forth against the Japanese yen during trading here on Tuesday and it does suggest that perhaps we do not really know what to do next as we are hanging around the 50-day EMA which in and of itself will cause a certain amount of chaos.

But I think you also have to realize that this pair is struggling due to the fact that the US dollar itself is a little soft during the trading session. However, I look at this as a buy on the dip opportunity and you do get paid to hang on to the US dollar against the Japanese yen.

Furthermore, this is a great measuring stick as to how the Japanese yen may or may not behave. And I think at this point it is obvious that the Japanese yen is in significant trouble and with that being the case I do prefer to hold the dollar as it pays you at the end of every day Policy and Technical Support

But we are also a little stretched from a longer-term perspective. Maybe a little bit of choppiness here is on tap. I suspect you probably have an easier time with something like the British pound against the Japanese yen but I also recognize that they all tend to move in the same direction over the longer term.

The Bank of Japan finds itself in a situation where it has a lot of problems tightening monetary policy despite the fact that yet again people fell for that line. Now we have a situation where I think the 200-day EMA becomes increasingly important.

As long as we can stay above there, I am looking to buy dips, maybe collect profit on the way up and then buy the next dip. I do think the US dollar does eventually reach the 158-yen level again.

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