USD/JPY Bulls Look to Re-Assert Control Ahead of Key US Data

Talking Points

  • USDJPY exposed to US eventuality risk- constructive above 112.39
  • Updated targets cancellation levels
  • Join Michael for Live Weekly Strategy Webinars on Mondays at 12:30GMT


USD/JPY Daily Chart

Technical Outlook: USDJPY pennyless above channel insurgency fluctuating off a 2017 highs and a 100-day relocating normal this week with a convene branch only forward of a 61.8% retracement of a decrease during 114.61. The broader concentration stays constructive while above former channel insurgency with a crack aloft targeting a pivotal insurgency section during 115.51-116.08.

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USDJPY 240min

USDJPY 240min Chart

Notes: A closer demeanour during cost movement highlights a medium-term slope we’ve been tracking off a Apr lows with a dissimilarity into a top together fueling some waste into a US trade session. The pullback is now contrast an embedded pitchfork and a mangle of this support might be a initial vigilance of a some-more suggestive pullback in USDJPY. That said, halt support rests during 112.90 corroborated by 112.39 (near-term bullish invalidation).

While a evident topside disposition stays during risk, eventually I’d be looking to blur a pullback with a crack aloft targeting 114.61a convene leading this segment eyes successive topside objectives during 115.52 116.08/14.

A third of a daily normal loyal operation (ATR) yields distinction targets of 27-31 pips per scalp. Added counsel is fitting streamer into a flurry of U.S. mercantile information tomorrow with a recover of a Apr Consumer Price Index (CPI), Retail Sales total a University of Michigan view surveys expected to fuel increasing flighty in a dollar crosses. As it pertains to a Fed policy, keep a tighten eye on a salary expansion total to potentially be a broader motorist of cost movement following a release.

USD/JPY Bulls Look to Re-Assert Control Ahead of Key US Data

  • A outline of IG Client Sentiment shows traders are net-short USDJPY- a ratio stands during -1.03 (49.2% of traders are long)- diseased bullish reading
  • Retail traders have been net-short given Apr 18- a span is adult 3.1% given then
  • Long positions are 3.9% reduce than yesterday and 7.0% next levels seen last week
  • Short positions are 0.5% higher than yesterday but 4.7% reduce from final week
  • While broader view continues to indicate higher, a new squeezing in a ratio does leave a evident topside disposition exposed streamer into tomorrow’s U.S. eventuality risk. That said, from a trade standpoint, I’ll preference vanishing debility into constructional support.

See how shifts in USD/JPY retail positioning are fulfilment marketplace trends.

Relevant Data Releases

USD/JPY Bulls Look to Re-Assert Control Ahead of Key US Data

Other Setups in Play:

– Written by Michael Boutros, Currency Strategist with DailyFX

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