USD/JPY Analysis: Gravitates towards 50% Fibo

Dukascopy Bank Team Dukascopy Bank SA

"The dollar may not be able to defend its number one spot if the economic outlook turns negative, handing its top safe-haven place to the yen."

- State Street Global Markets (based on Reuters)

Pair's Outlook
Investors sold the American Dollar on Monday, due to uncertainty emitting from the US political debates that day. As a result, the USD/JPY currency pair crossed the nearest demand area, represented by the monthly S1 and the 50% Fibo. However, a significant drop lower would still be an achievement, as it would imply a full-scale breach of the 100.00 psychological level. In turn, the 100.00 mark is reinforced by the weekly S1 and the Bollinger band, also indicating that a fall deeper down is highly improbable today. The base case scenario is a rally, but it is uncertain whether the Buck will be able to climb over the 100.75 level, with technical indicators unable to confirm the bullish scenario.
Traders' Sentiment
Today 64% of traders are long the US Dollar (previously 63%), whereas the 61% of all pending orders are to buy the Buck (down from 63%).

Author

Dukascopy Bank Team

Dukascopy Bank SA

Dukascopy Bank stands as an innovative Swiss online banking institution, with its headquarters situated in Geneva, Switzerland.

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