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27 Aug 2013
Flash: What to do with the USD/JPY? – BTMU and Scotiabank
FXstreet.com (Edinburgh) -Increased risk aversion stemming from geopolitical tensions surrounding Syria and the likeliness of a US military intervention have intensified the exodus to safe havens on Tuesday, dragging the USD/JPY from peaks around 98.80 to the current region around 97.20.
In the opinion of the research team at BTMU, the key release of the CPI data later on the week will probe crucial, as “market expectations of lower real yields in Japan will help encourage renewed selling of the yen as a sign of success in ‘Abenomics’. Since the market tried the lower side of USDJPY earlier this week and found strong support at the 97.00 level, USDJPY may well now edge higher and may possibly test the 100.00 level”.
In addition, Camilla Sutton, Chief FX Strategist at Scotiabank, argued that the technical studies remain mixed, adding “the MACD and moving averages in bullish territory, but the DMI in sell and the ADX at 12, suggesting the lack of a trend. We see better risk reward elsewhere”.
In the opinion of the research team at BTMU, the key release of the CPI data later on the week will probe crucial, as “market expectations of lower real yields in Japan will help encourage renewed selling of the yen as a sign of success in ‘Abenomics’. Since the market tried the lower side of USDJPY earlier this week and found strong support at the 97.00 level, USDJPY may well now edge higher and may possibly test the 100.00 level”.
In addition, Camilla Sutton, Chief FX Strategist at Scotiabank, argued that the technical studies remain mixed, adding “the MACD and moving averages in bullish territory, but the DMI in sell and the ADX at 12, suggesting the lack of a trend. We see better risk reward elsewhere”.