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"As investors remain focused more on the BOJ meeting this time, we would see the dollar-yen pair to show only a limited reaction (to the Fed statement)."
- Barclays (based on Market Watch)
Pair's Outlook
The USD/JPY managed to erase daily losses on Tuesday, as a strong reading of the US CB Consumer Confidence boosted the American currency. Even though the pair closed with a 12-pip surge, a relatively tough group of levels is supporting the Buck from below. The 20-day SMA, the weekly PP and the monthly S1 form a cluster around 117.90, whereas the monthly S1 at 118.93 remains the nearest resistance. Technical indicators also changed direction from south-ish to mixed, suggesting a decline is unlikely. Nonetheless, the FOMC statement's tone could cause a breakout of either barrier.
Traders' Sentiment
There are now 72% of traders being short the Greenback (previously 71%). The share of orders to buy the USD slid from 61 to 58%.
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