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Forex pairs in this Article » EUR/USD, GBP/USD, USD/JPY
- Japanese Yen could see major moves on a highly-anticipated BoJ decision

- Our Senior Currency Strategist highlights critical USDJPY price levels

- Sentiment-based trading strategies would likely latch onto Yen reversal

The US Dollar and Japanese Yen stand at major levels versus the Euro and other forex counterparts. What might force a break and how could we trade it?

Traders have kept the Greenback within a tight trading range versus the JPY, but the next move could be sharply lower in the USDJPY; our Senior Technical Strategist highlights key levels to watch.

The obvious question is whether this week will bring that major break, and if so how might we trade it? A highly-anticipated Bank of Japan interest rate decision could indeed bring the volatility we’ve been watching for. And given the fact that traders were recently their most short JPY futures on record (long USDJPY), there’s real risk that panic-driven short-covering could send the Yen higher (USDJPY lower).

In the meantime we’re admittedly at a bit of an impasse; until we see major breakouts/trends, there may be few compelling trade opportunities.

Our purely forex sentiment-based Momentum2 trading strategy recently got aggressively long the JPY against the Dollar, Euro, British Pound, and Swiss Franc. Yet those positions were stopped out at modest losses as pairs reversed.

We’ll keep a close eye on the Japanese Yen and keep traders updated via our forex real time news feed. Take a look at full strategy preferences below and sign up for future e-mail updates via my distribution list.

Forex Volatility Prices Have Picked Up Following Last Week’s Lull but Remain Low

japanese_yen_trading_forecast_and_trade_setups_body_Picture_1.png, Japanese Yen Might Finally See Big Moves - How Can we Trade?Source: OTC FX Options Prices from Bloomberg; DailyFX Calculations

DailyFX Individual Currency Pair Conditions and Trading Strategy Bias

japanese_yen_trading_forecast_and_trade_setups_body_Picture_2.png, Japanese Yen Might Finally See Big Moves - How Can we Trade?japanese_yen_trading_forecast_and_trade_setups_body_Picture_3.png, Japanese Yen Might Finally See Big Moves - How Can we Trade?Automate our SSI-based trading strategies via Mirror Trader free of charge

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