© Dukascopy Bank SA
The Dollar/Yen pair started trading on Monday at the 123.15 level, but was not able to sustain bullish momentum from previous weeks and dropped significantly at the end of the week. Meanwhile, in the middle of the week, the pair also experienced a significant plunge in value. The USD/JPY diminished to a one-month low on Wednesday, as the US Dollar weakened against all of its major currency peers. There were no major macro events scheduled for Wednesday, which increased the risk of the bearish momentum extending. Nevertheless, the US Dollar bounced higher against the Japanese Yen on Friday morning, making up for lost pace after reaching a one-and-a-half month low on Wednesday. An absence of data on Friday in Asia did little for the Japanese Yen, which was down sharply against the greenback ahead of US data.
This week's overall sentiment for the USD/JPY pair changed back to distribution seen two weeks before, as 62.5% of all traders are now supporting the bearish case for the pair. Slightly more than 25% of traders expect the pair to close above the 121 level towards the end of present working week. This Monday, Tankan manufacturing outlook stood at plus 12 in December, unchanged from three months ago. Despite that, the non-manufacturing gauge went up to 16 points. Concerning other announcements from Japan, on Friday, the Bank of Japan is to publish the minutes of its latest monetary policy meeting, giving investors insight into how officials view the economy and their policy options.
© Dukascopy Bank SA