Japanese Yen Could Rally Against the Dollar
USDJPY: Retail trader data shows 59.2% of traders are net-long with the ratio of traders long to short at 1.45 to 1. The percentage of traders net-long is now its highest since Dec 15 when USDJPY traded near 112.595. The number of traders net-long is 29.8% higher than yesterday and 20.9% higher from last week, while the number of traders net-short is 1.2% higher than yesterday and 23.5% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USDJPY prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger USDJPY-bearish contrarian trading bias.
--- Written by Dylan Jusino, DailyFX Research