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"The yen's quite sensitive to risk appetite. The Bank of Japan has been pretty ineffective in getting the yen weaker even though we expect further easing from them. It's just a sense that there's not a lot the Bank of Japan can do about the yen."
- Bank of New Zealand Ltd. (based on Bloomberg)
Pair's Outlook
A poor reading of the US Factory Orders caused the USD to weaken against the Yen on Monday, with the Bollinger band limiting the losses. Earlier today BoJ Kuroda's statement sparked risk aversion to appear in the markets, with the USD/JPY falling lower. No impetus today is expected to turn the tables around and help the pair recover. Furthermore, technical indicators are bolstering the possibility of the negative outcome. The Buck faces a tough support cluster around 110.75, represented by the Bollinger band, the weekly and the monthly S1s, which is to prevent the pair from edging lower. In case this area gives in, the channel's support line at 110.39 will be the next target.
Traders' Sentiment
Bulls lost some numbers, as 70% of all open positions are long (previously 74%). The number of sell orders increased from 62 to 63%.
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