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"While there has been a lot of talk about deflation, we think that the implications of such a scenario have not been fully grasped. Without decisive policy action, a Eurozone break-up would be hard to avoid in this scenario."
- Oxford Economics (based on The New York Times)
Pair's Outlook
As expected the pair continued to appreciate, but 2009 high is not willing to give up easily. We do not expect that much will change until the end of the trading week. Even if the pair advances higher, it is almost certain that 140 JPY will cause it to take a step back. All in all, we expect the pair to trade sideways for some time. In case of an unexpected failure if should not fall below 137.76.
Traders' Sentiment
Market sentiment changed marginally. Bears continue to hold 58% of all open positions on the pair. Bullish side of pending orders increased by 3% and is at 71%.
© Dukascopy Bank SA