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"Rather, we would expect the yen's undervaluation to drive the yen's strength instead, not just against the dollar, but also against most of the G7 currencies."
- Credit Suisse (based on CNBC)
Pair's Outlook
The USD/JPY touched the target resistance, namely the Bollinger band, yesterday, but closed at 124.63. Nevertheless, the given pair still appreciated and is expected to extend its rally today as well. The Bollinger band shifted higher, closer towards the 125.00 psychological level, which is also bolstered by the weekly R1. Together these levels form a strong resistance, limiting the probable gains today; however, a breach is possible if the pair receives a sufficient fundamental boost. Technical studies are now showing mixed signs, leaving the door open for a slump under the weekly PP.
Traders' Sentiment
Bulls keep retreating, as only 71% of all positions are now long (previously 73%). The share of buy orders inched up from 67 to 72%.
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