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Japanese Yen Forecast to Fall Further (USDJPY, GBPJPY Rally)

By , Quantitative Strategist
05 September 2013 14:30 GMT
ssi_gbp-jpy_body_Picture_16.png, Japanese Yen Forecast to Fall Further (USDJPY, GBPJPY Rally)

Japanese Yen – An outright surge in retail forex crowd Japanese Yen buying (USDJPY, EURJPY, GBPJPY selling) leaves us in favor of continued JPY weakness.

Trade Implications – GBPJPY: Retail forex short positions in the GBPJPY have surged by more than 150 percent since last week—leaving total open short positions at their highest since April, 2011 when the GBPJPY was trading near ¥136.

Our sentiment-based Momentum2 strategy has accordingly gone long GBPJPY, USDJPY, and AUDJPY. We like those positions as long as crowds continue to buy into JPY weakness.

Written by David Rodriguez, Quantitative Strategist for DailyFX.com

ssi_gbp-jpy_body_Picture_17.png, Japanese Yen Forecast to Fall Further (USDJPY, GBPJPY Rally)

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
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05 September 2013 14:30 GMT