The US dollar initially tried to rally during the trading session on Wednesday but gave back the gains to show signs of exhaustion in general. Ultimately, the market looks as if it could drop from the lows of the last couple of days and perhaps reach towards the ¥105 level, but one should also keep in mind that the US economy is struggling due to the coronavirus. Having said that, Japan also has the same issues so at this point it’s likely that people will run to the safety of the Japanese yen in general.
USD/JPY Video 02.04.20
It should be noted that the volatility will continue to be crushing, which of course is a sign that people will probably be looking for safety in general. While the US dollar is considered to be a safety currency, the Japanese yen typically outshines it. Furthermore, I think we are trying to find a range so it should not be a huge surprise that we would drop down towards the bottom again. I think this market will eventually find “fair value, but we may not be there yet. In other words, we have a lot of noise ahead of us. Furthermore, the job summer comes out on Friday and of course that will be one of the main focuses on the minds of Forex traders. This pair tends to be particularly sensitive to that announcement, so therefore you can expect a lot of bouncing around in the next couple of days, especially at 8:30 AM New York time on Friday when the announcement comes out.
This article was originally posted on FX Empire
More From FXEMPIRE:
- USD/CAD Daily Forecast – Virus Worries Push U.S. Dollar Higher
- Silver Price Forecast – Silver Markets Continue to Slump
- EUR/USD Price Forecast – Euro Plunges
- E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Downside Target 7261.00 to 7111.75
- Gold Price Prediction – Prices Rebound but Face Strong Dollar Headwinds
- Crude Oil Price Forecast – Crude Oil Trying to Break Down Even Further