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"USD/JPY generally falls when the Federal Reserve is hiking the Funds rate. A higher Funds rate is a signal of a stronger US economy."
- Commonwealth Bank of Australia (based on FXStreet)
Pair's Outlook
Although the 119.00 level was tested again, the USD/JPY still appreciated on Tuesday, amid a rebound of the investor sentiment. Furthermore, the 120.00 mark was retaken, while the Buck feels ready to extend its rally for the third consecutive day. Nonetheless, a substantial resistance cluster, represented by the weekly R1, monthly PP, 20 and 200-day SMAs, is blocking the Greenback's path around 121.00. If breached, the US Dollar is likely to reach a fresh two-week high afterwards, with the next target shifting to 122.70.
Traders' Sentiment
Bullish SWFX traders' sentiment returned to its Monday's level of 73% (previously 74%). The buy and sell orders edged closer to the equilibrium, as only 51% of commands are to acquire the Buck.
© Dukascopy Bank SA