COTD - 18/03 USDJPY

Revisiting USDJPY today as the pair continues to hover around some interesting areas.

2 weeks ago we had USDJPY as our chart of the day where we took a look at some of the fundamental drivers affecting the pair.

Whilst the fundamental factors still stand for the Yen half of this particular asset over the past two weeks we have seen some weakening on the US Dollar side.

Since then we have seen the USDJPY cross trade down from the big number 112 handle, after a few attempts, lacking momentum & conviction, to break through. Since then the pair drifted lower to test the bullish trendline we spoke about previously and with the RSI dipping into oversold, we saw the bulls come in and pushed the price higher.

We saw the USDJPY push towards the 112 handle again recently but again failed to even reach it, let alone clear the level, however this mainly due to the weakness in the US dollar.

Something to bear in mind is the currently diminishing level of volatility of this pair, which is currently at the lowest level since 2014.

Whilst the current trend remains bullish for this asset, it looks like it may take a move with some momentum, spurred by some macro news to push this through the 112 handle and hold it above, especially given the buy stops hovering above the level.

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USDJPY