Japanese Yen Likely to Fall to Fresh Lows
Japanese Yen – Forex trading crowds remain long USDJPY, but positioning has grown far less one-sided since last week. The shift in sentiment actually leaves us bullish USDJPY and broadly bearish the Yen itself.
Trade Implications – USDJPY: Our proprietary SSI data leaves us in favor of Japanese Yen weakness, but our calls for Dollar depreciation make us less bullish USDJPY and more in favor of going short JPY against other currencies (e.g. long AUDJPY, long EURJPY). Indeed, our Momentum2 system is in a good position as it’s currently long a number of JPY crosses—we like those positions.
Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.