Preparing for a possible downward trend of the USDJPY
A downward trend might just be on the verge for the US Dollar against the Japanese yen (USDJPY). The greenback has broken below the base of the daily ichimoku cloud three times in the past three trading days, but without closing outside of it. If it so happens to do so, the downwards trend could be ready to start. Now, if the narrative on relative dollar weakness is to be believed, then USDJPY is going to be testing the 118.30-50 zone, which could potentially open a path first towards 116 and then even to 115, says Saxo Bank’s Head of FX Option and FX Forward trading, Gustave Rieunier. The 118.40 level is key, says Rieunier. "A close below that level could see dollar weakness test as far down as 115 with 115.50 and 116 on the route." (VIEW LINK)
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