EUR/JPY remains quiet

Whereas forecasts for the next quarters are substantially lower than the spot price—107, 108 and 109 for Q1, Q2 and Q3, respectively, technical analysis suggests there is still some scope for extension of the rally. In the meantime, the pair undergoes a bearish correction, development of which into a separate leg down should be prevented by 113.18. If it fails to do so, then 111.68/28 will become the last resort of a near-term bullish outlook.

Bullish market participants are gradually enhancing their dominance over bears, which is not yet prominent, but already notable, with 57% of positions being long and the rest (43%) being short. Distribution between buy and sell orders is alike—60% and 40%, accordingly.