US Dollar to Fall Further versus Japanese Yen
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USDJPY– Retail FX traders remain extremely net-long the US Dollar versus the Japanese Yen, and a contrarian view of crowd sentiment points to further USD/JPY weakness. Indeed, our data shows there are currently 2 open retail positions long USD/JPY for every 1 short—66 percent of open interest is long.
Traders have remained net-long since the pair traded near ¥120 through late 2014. In that stretch the USD/JPY traded to decade highs near ¥126 but ultimately tumbled to recent lows below ¥108. Until we see a marked and sustained shift towards crowd selling, we see little reason to abandon our long-standing bearish trading bias for the USD/JPY.
See next currency section: XAUUSD - Gold Price Outlook Remains Bullish until this Changes
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.