Japanese Yen Downtrend Intact, but Watch Next Moves
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USDJPY –We remain overall bullish the dollar but would ideally see a build in crowd selling before buying into USDJPY.
Trade Implications – JPY Pairs:Our retail positioning data shows that 55 percent of open positions are currently long the USDJPY, and our typically contrarian view of crowd sentiment would normally point to short-term weakness. Yet it’s worth noting that total long positions have fallen 20 percent since last week as short positions are unchanged. The recent shift leaves us somewhat bullish—particularly as overall trends remain supportive of US Dollar strength.
See next currency section:AUDUSD - Australian Dollar at Clear Risk of Continued Breakdown
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.