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"Our sense is that the risk of monetary easing next week is growing and certainly looking at the JGB market with yields falling notably, market participants generally are sensing an increased chance of action."
- Bank of Tokyo-Mitsubishi (based on WBP Online)
Pair's Outlook
Fears of the BoJ intervention keep driving the Japanese currency lower this week, with another USD/JPY rally taking place on Wednesday. Even though the immediate resistance area was pierced yesterday, the 110.00 major level remains intact. The closest resistance area is now located around 110.50, namely the 20-day SMA, the monthly S1 and the weekly R2, also being the final cluster before the exchange rate reaches the 112.00 mark, where the 11-week down-trend is to be retested. However, according to technical studies the Greenback could slump back under 109.00 today, amid weak fundamental data results.
Traders' Sentiment
Bullish traders' sentiment returned to its Tuesday's level of 70%, compared to 73% on Wednesday. At the same time, the number of orders to buy the US Dollar declined from 70 to 45%.
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