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"If euro-dollar closes significantly above $1.18 and dollar-yen under 119, we might be in for some further U.S. dollar consolidation."
- Saxo Bank (based on Bloomberg)
Pair's Outlook
Yet again USD/JPY failed to sustain a recovery, but this time already in the vicinity of 120 rather than near the December highs at 121. Nonetheless, the pair is well-supported at 118, where the 55-day SMA merges with the 23.6% retracement of the Oct-Dec rally, meaning there are likely to be even more attempts to breach the nearby supports and finally surpass the 2014 high at 122 without violation of the key supports.
Traders' Sentiment
The SWFX sentiment returned to being neutral with respect to the US Dollar—55% of open positions are long (57% on Friday). Meanwhile, the percentage of buy commands keeps decreasing, from 68% recorded last week it fell to 60%.
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