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"The dollar/yen might not go much higher for now because people are a bit knackered after covering short positions."
- Global-info Co. (based on CNBC)
Pair's Outlook
The risk appetite returned to the markets on Wednesday, causing the USD/JPY currency pair to edge higher, despite rather weak US Retail Sales figures. Momentum, received after reconfirming the 18-month low, appears to be sufficient for the Buck to sustain a short-term bullish trend. Consequently, the US Dollar is expected to continue rising versus the Japanese Yen, with the closest area to limit the gains located around 110.80, represented by the monthly S1, the weekly R1 and the 20-day SMA. However, according to technical indicators, the given pair is to suffer a loss today, falling back under the 109.00 major level, eventually putting the 18-month low to the test again.
Traders' Sentiment
Nearly three quarters (74%) of all open positions are long. Meanwhile, the gap between buy and sell orders narrowed from 4 to 2% points.
© Dukascopy Bank SA