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"USD price action suggests market participants may be rebuilding USD long positions cautiously, in anticipation of a potentially more hawkish message from the Fed or more dovish message from the BoJ at next week's policy meetings."
- BNP Paribas (based on WBP Online)
Pair's Outlook
On Wednesday, US Dollar appreciated against Yen amid substantial improvements in US fundamentals. However, USD/JPY failed to reach the initial resistance at 120.11. Today the Greenback is likely to edge down, unless the US data surprises again to the upside. The 20-day SMA lacks strength to stop a decline, thus a fall towards the weekly PP is the most probable outcome. Nevertheless, we should not rule out the possibility of a surge towards 120.26. The technical studies retain mixed signals, unable to bolster either scenario.
Traders' Sentiment
Traders' outlook towards the Buck remains positive, as the share of bulls returned to its Tuesday's level of 72%. The gap between buy and sell orders narrowed to 52% vs 48%.
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