Joining the Crowd in Buying USDJPY
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USDJPY –Forex trading crowds are now their most long the US Dollar versus the Japanese yen since the greenback last set a low near ¥101.35. Extremely low volatility suggests the USDJPY may once again bounce.
Trade Implications – JPY Pairs: We normally go against the crowd—if everyone is long we prefer to be short. Yet with forex volatility near record-lows, we see relatively limited scope for a major USDJPY breakdown. This is a rare instance in which we may actually favor joining the crowd in going long the Dollar versus the Yen. Important technical levels are seen at resistance of ¥102.20 and ¥101.42 support.
See next currency section:GOLD - Gold Prices Remain at Risk of Further Declines
Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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