‘At the very least the view is that Trump’s economic policies will be delayed over this [latest US political turmoil], and the dollar is being sold.’ – Matsui Securities (based on The Business Times)
Pair’s outlook
The USD/JPY pair experienced a rather devastating blow on Wednesday, losing more than 200 pips amid continued political turmoil in the US. After such a large slump the Buck is likely to undergo a bullish correction, unless political pressure keeps weakening the Greenback. Moreover, the monthly PP and the weekly S3 around 110.45 are providing rather strong support, which could be sufficient for a recovery to prevail. The nearest resistance rests at 111.40, namely the weekly S2, most likely marking the intraday high. The base case scenario is a close somewhere between 110.50 and 111.50.
Traders’ sentiment
There are 61% of traders holding short positions today (previously 66%), while the share of buy orders added 10% points, having risen to a total of 59%.
