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"I think the FOMC will likely provide extremely cautious outlook. Looking at the U.S. economy, the situation doesn't enable (the Fed) to keep knocking up rates."
- Yukio Ishizuki, Daiwa Securities (based on Market Watch)
Pair's Outlook
The US Dollar dropped to a fresh five-week low yesterday, but managed to partially recover from that slump, closing trade above the immediate support. Even though the monthly R1 is now bolstered by the Bollinger band, technical studies insist the USD/JPY is to edge even lower. Losses are unlikely to extend beyond the November low of 120.25. Meanwhile, a strong cluster, represented by the weekly PP, 55, 100 and 200-day SMAs, is to limit any volatility to the upside.
Traders' Sentiment
The gap between long and short positions keeps narrowing, as 56% of traders are short the USD today (previously 59%). Meanwhile, there are more orders to purchase the US currency, namely 56%.
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