USD/JPY: Bulls Fighting Back for 107 Handle
Its been a vacant week in Tokyo with national holidays, but that has not meant USD/JPY was out on holiday, far from it.
USD/JPY has been staging a decent recovery back on the 107 handle with a resurgence of dollar bulls taking up opportunities at short-term bargain prices across the board. USD/JPY rallied from 105.54 yesterday and made that freak spike from 106.59 to score highs of 107.45 in early Asia yesterday. The price has since been good two way business between 107.20 and 100 pips lower, but oscillating between 106.50 and testing the 107 handle in the main.
Data overnight was favourable to the greenback with a bounce in factory orders offsetting the weak ADP employment report that enabled the greenback to continue advancing across the board. For today, we will have Australia as the main catalyst again for the FX space with retail sales and trade balance while otherwise, the U.S. calendar is very low key until payrolls on Friday, but we will hear from St. Louis Fed president Bullard (centrist, voter).
Extra reading: Nonfarm Payrolls - "Fuhgeddabouit" !
Valeria Bednarik, chief analyst at FXStreet noted that USD/JPY, in the 4 hours chart, the latest consolidation helped indicators to correct extreme oversold readings. "But...are currently flat around their mid-lines, whilst the price is far below its 100 and 200 SMAs, all of which supports additional slides towards the 105.00 region, particularly if the ongoing negative mood prevails."