USD/JPY Weekly Price Forecast – US Dollar Continues to Plow Higher

　　The US dollar has broken out above the ¥110 level during the course of the week, which of course in and of itself is a psychological milestone. That being said, this is a market that is so overbought that one has to wonder whether or not there is not going to be some type of nasty pullback coming？ One thing is for sure, I would be very cautious about shorting this pair, because quite frankly I could have said that we are overbought multiple times, and with that in mind I think that we are looking at a scenario where you have to be patient in order to take advantage of any type of move right now.

　　USD/JPY

　　Pullbacks will be looked at as potential buying opportunities, but I think we need to see a significant pullback in order to get long again. The ¥109 level would be a great place to get involved, but we may turn around and simply break above the ¥111 level, which allows the possibility of even more gains. Quite frankly, it is going to be difficult to see that happen without being very concerned, so I think if we simply turn around and break out to the upside, I will probably buy one of the other yen related pairs as it will almost certainly have to play a bit of catch-up. The 200 week EMA is sitting at the ¥108 level, and I think at the moment that is probably going to be our “floor the market.” With that being the case, this is a market that I think will continue to see more of an upward bias even though we are overdone.