‘Our basic stance is that the correction in the USD/JPY will halt at ¥110-115, but we should be paying closer attention to downside risk at least for the short term.’ – Deutsche Bank (based on FXStreet)
The less favourable for the US Dollar scenario prevailed on Friday, causing the pair to edge lower once again. Nevertheless, the USD/JPY pair managed to retain its position above the 112.00 handle, which in turn is supported by the 100-day SMA, the lower Bollinger band and the weekly S1, while the 111.75 mark also acts as a tough psychological support. Consequently, another bearish development is unlikely, despite technical indicators suggesting so. The Greenback could easily reach the 113.00 level today, should the fundamentals provide a sufficient boost later during the day; however, disappointing data could still cause a downside reaction.
Market sentiment remains bullish, now at 61% (previously 54%). Meanwhile, the portion of buy orders edged down from 67 to 59%.