‘As recent data suggest, the United States is not in bad shape fundamentally and this should be dollar-supportive. But right now the tide favours the yen and participants do not want to miss the next wave of yen buying.’ – BBH (based on Reuters)
Pair’s Outlook
The US Dollar suffered a great deal on Tuesday, amid rising tensions over both Syria and North Korea. As a result, the Buck lost more than 130 pips against the Japanese Yen, crossing the 110.50 psychological support, now being one step away from retesting the descending channel’s lower border at 109.09. The support line is unlikely to be pierced, as it is bolstered by a number of other levels of significance. From a broad technical perspective the USD/JPY pair should post a recovery today, despite technical indicators suggesting otherwise. We, however, still expect the channel’s support line to be put to the test before a rebound occurs.
Traders’ Sentiment
Once again 70% of all open positions are long (previously 65%). Meanwhile, the share of buy orders inched up from 57 to 61%.
