© Dukascopy Bank SA
"Dollar/yen surging to 123.60 looked overdone and we are now seeing a consolidation. On the other hand, the dollar cannot drift too low due to the U.S.-Japanese yield differential theme. I don't see the currency falling much below 122.00 yen."
- FPG Securities (based on Reuters)
Pair's Outlook
The USD/JPY extended its correction for another day, despite distinctly bullish technical studies, which mostly proved to be unreliable this week. Nonetheless, the Greenback might still end the correction, rebounding towards the immediate resistance cluster, namely the monthly R1 and the Bollinger band around 123.60. At the same time, a rather large group of potential supports lie just beneath the spot price, ranging all the way to the 121.00 major level. Any of these levels could limit the losses in case those occur.
Traders' Sentiment
Traders retain a negative outlook, as exactly three quarters of them are short the Buck. The share of purchase orders, however, added four percentage points, now taking up 74% of the market.
© Dukascopy Bank SA