US Dollar Remains Likely to Hold Support versus Yen
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USDJPY – Retail FX traders remain steadily long the US Dollar versus the Japanese Yen and have remained long since June. We most often treat this as a contrarian indicator to price action; the fact that most are long would make us take the opposite position and look to go short. Yet it’s likewise clear that traders have done reasonably trading the wide range in the USD/JPY through recent months.
We’ve recently highlighted the significance of major USD/JPY support at the ¥119 mark and why a further US Dollar breakdown would likely coincide with a substantial change in market conditions. Until that happens, however, we see little reason to believe that the USD/JPY will break to further lows.
See next currency section:AUDUSD - Australian Dollar Test of Support is a Big Deal
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.