© Dukascopy Bank SA
"There has been some major short covering in the U.S. dollar over the past week. The U.S. dollar will likely continue to edge higher against the background of growing cautiousness towards risk assets "
- Credit Agricole CIB (based on Bloomberg)
Pair's Outlook
While approaching an apex of a falling wedge, range of USD/JPY is becoming increasingly narrow, being formed by 78.69/84 from above and by 78.20/77.99 from below. An interim level is at 78.43/37, but is hardly able to shape behaviour of the pair. In the near future the price is expected to remain tranquil, although an upside risk increases with each additional unit of time.
Traders' Sentiment
USD/JPY is presently overbought, as evidenced by the share of bulls on the currency pair—73% of the market. On the other hand, 27% of traders believe the Japanese Yen is poised for gains relatively to the greenback. Dominance of buy orders over sell ones is even more distinct, as they constitute 81% of the total amount.
© Dukascopy Bank SA