A research analyst from Westpac, Sean Callow shared his analysis with us which suggests that after staying bullish since last week, they are pretty much happy with the price action – Keeping in mind that the spot USDJPY is up about 0.05% even including a test of important resistance level at 113.
“Sharp slide under 112 on Friday was mainly due to the pair eternal risk sensitivity and a classic risk off move, on the headlines over Flynn/ Trump/ Russia.”
“According to CME data, speculative positions remain substantially long USD/JPY.”
“We remain bullish for the week and month of December. The expected trading range is around mid-113s. If the upcoming data like NFP, FOMC rate hike is positive and further progress on tax cut bill happens, it could go even beyond 113.
“JGB yields should remain anchored by the BoJ’s dedication to YCC – adjusting purchases to market conditions.”