DAILY NOTION - FXEMPIRE - USD/JPY Forecast - Nov 12, 2020

The Dollar/Yen is trading lower on Thursday after hitting its highest level since October 20 the previous session. The move is likely being fueled by profit-taking after a nearly weeklong rally. The catalyst behind the weakness is a sharp drop in U.S. Treasury yields.

Although the Treasury Department was closed on Wednesday, the futures market were open and the December 10-year U.S. Treasury note posted a closing price reversal bottom, indicating that yields had reversed lower. On Thursday, buyers are following through to the upside and rates are falling further, making the U.S. Dollar a less-attractive investment.

At 06:10 a.m. (GMT), the USD/JPY is trading 105.234, down 0.198 or -0.19%.

What's next?

The price action the last two sessions indicates that the direction of the USD/JPY on Thursday is likely to be determined by trader reaction to the 50% level at 105.113.

For bearish scenario, a sustained move under 105.113 will indicate the presence of sellers. This is a potential trigger point for an acceleration to the downside with 104.427 to 104.132 the next likely downside target.

As for bullish scenario, a sustained move over 105.113 will signal the presence of buyers. This could trigger a surge into 105.570, followed closely by 105.677. This is a potential trigger point for an acceleration to the upside.

Original analysis: https://www.fxempire.com/forec...