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"The BoJ decision will have a lasting negative impact on yen because speculative positioning was the wrong way."
- Westpac (based on Business Recorder)
Pair's Outlook
The USD/JPY currency pair's rally, triggered by the BoJ's decision, was only prevented by the 200-day SMA circa 121.46 last Friday. The same SMA keeps providing formidable resistance today, increasing the chance of the Buck turning around and inching lower against the Yen. Meanwhile, immediate support is represented by the Bollinger band, the 55 and the 100-day SMAs around 120.57. The 55-day SMA is also on the edge of crossing the 100-day one to the downside, which is a signal to sell the US currency. Other technical studies, on the other hand, are unable to confirm the bearish scenario.
Traders' Sentiment
Today 73% of traders are short the Greenback, whereas the portion of purchase orders barely changed, sliding down from 57 to 56%.
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