Japanese Yen Targets Further Lows
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USDJPY – Retail FX trading crowds have continued to buy into Japanese Yen weakness (sell USDJPY, EURJPY, and GBPJPY strength), and our purely-sentiment based Momentum2strategy has done well selling into declines.
Trade Implications – JPY Pairs: Trading crowds have actually become less long the Japanese Yen since last week, which suggests that the pace of USDJPY and JPY-cross gains may slow. Yet we’ll need to see a material turn in sentiment before calling for a major reversal. And indeed our Senior Technical Strategist sees evidence the USDJPY could soon extend to fresh highs at ¥105.
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.