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The Japanese Yen has been showing a surprising strength in the recent weeks, with the USD/JPY pair hitting 113 mark. Last week, however, the pair pulled back from that level and head toward daily R1 and around 113-level. The main reason for such a reaction was terror attacks in Brussels, as well as rather hawkish speech by the Fed's Evans.
Dukascopy Community members have lost their faith in the currency pair, as following a drop to 50% in the army of bulls, this week the number of bullish votes slipped to 46.2%. A vast majority of traders believe that the pair will end this week around 112.7-mark, thus practically unchanged from the price at the moment of writing. At the same time, the consensus forecast correlates with the result of our technical analysis and echoes with neutral or ‘buy' signals from aggregate technical indicators.
From the perspective of fundamental analysis the pair can be highly volatile, especially on Friday, after the publication of the Tankan surveys of the manufacturing and services sectors. From the American side, on Wednesday, is going to be released the monthly ADP nonfarm payrolls report, while the next day, in turn, the report on initial jobless claims. Also, the US is to round up the week with the closely watched nonfarm payrolls report as well as data from the Institute of Supply Management on manufacturing activity. The outlook for the pair is bearish, however, fundamental data can push the pair in any direction, hence, traders should pay attention to the news releases.
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