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"Direct currency intervention remains a threat at below 105 yen levels. Yet the BoJ must tread lightly as unsuccessful action will only erode their credibility, which is critical in policy setting."
- Swissquote (based on Reuters)
Pair's Outlook
Even though the US Dollar managed to take advantage of risk appetite and outperform the Japanese Yen on Tuesday, risks of the pair edging lower today persist. First of all, technical indicators retain their bearish signals, bolstering the possibility of the negative outcome; second, the USD/JPY currency pair was unable to reconquer the 109.50 level, which kept the Buck pressured ever since the first rebound from the 18-month low occurred. Nonetheless, the monthly S2 and the weekly PP form a rather strong support cluster at 108.70, where dips are likely to be limited if the bearish momentum prevails.
Traders' Sentiment
Once again 73% of traders have a positive outlook towards the Greenback (previously 70%). Meanwhile, the number of orders to acquire the USD slightly declined, but still takes up 70% of the market.
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