‘We’re still seeing long-term guys buying the dollar on dips, expecting it to eventually recover on interest rate differentials between Japan and the US. But sometimes, it’s a short-term market.’ – Global-info Co (based on Market Watch)
There were no surprises in the USD/JPY pair’s performance yesterday, as the 112.60 psychological support remained intact in spite of the Yen taking the upper hand. From the technical perspective the Buck should now rebound, but with gains being capped around the 114.50 mark, where the monthly and the weekly PPs rest, as well as the 20 and the 55-day SMAs. A strong US NFP reading today could also indicate to a possible rate hike as early as in March, providing the US Dollar with a solid boost. However, technical indicators insist a bearish development is more probable, with the only strong support being the area around 110.25.
Traders retain a positive outlook towards the Buck, as 61% of all open positions are now long, compared to 53% on Thursday.