Dukascopy - Analytics

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USD/JPY stuck between 122.00 and 123.50

© Dukascopy Bank SA
"A speech by New York Fed President Dudley on the U.S. economic outlook to the Economic Club of New York may provide more fodder. The USD could be vulnerable if Dudley were to emphasize that USD strength might be a factor restraining tightening over the course of 2016."
- BNP Paribas (based on Reuters)

Pair's Outlook
The US Dollar dropped slightly below 123.00, but remained at a ten-month high. With no support or resistance neither pierced nor tested, the Buck is likely to resume trade in its current tight range, namely between the cluster around 123.55 and the one around 122.00. However, technical indicators are now emitting distinctly bullish signals, suggesting a rally is imminent. As a result, chances of the monthly R2 and the Bollinger band around 123.55 getting tested today increase; a sell-off would still not be a surprise, as the USD/JPY  keeps undergoing a post-NFP correction.

Traders' Sentiment
Meanwhile, bears remain strong, with 72% of all positions still short. Buy orders are in the majority, but slightly declined from 72 to 70%.

© Dukascopy Bank SA


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