Yen profit taking is coming
The USDJPY pair extends gains for a seventh day in a row on Thursday, with the price is testing more that two-week lows in the 110.60 area. Interestingly, the dollar is not inspired by a rise in the 10-year US Treasury yield to a six-week high close to 3%, and it looks like the pair is set for further losses in the short term.
The greenback has been trading on the defensive against major rivals this week, but the pressure in the USDJPY pair is especially strong. The yen bulls’ enthusiasm is due to the recent speculations around the possible Bank of Japan policy shift, with traders hope that the central bank will announce a change to the negative interest rate settings.
However, the regulator will likely refrain from major adjustments during the upcoming meeting early next week. Therefore, there is a risk of a massive profit-taking in the USDJPY pair, which could open the way to the 111.50 area. Meanwhile, the greenback could continue its decline in the short term, though the 110.00 figure should serve as a support area.
The greenback has been trading on the defensive against major rivals this week, but the pressure in the USDJPY pair is especially strong. The yen bulls’ enthusiasm is due to the recent speculations around the possible Bank of Japan policy shift, with traders hope that the central bank will announce a change to the negative interest rate settings.
However, the regulator will likely refrain from major adjustments during the upcoming meeting early next week. Therefore, there is a risk of a massive profit-taking in the USDJPY pair, which could open the way to the 111.50 area. Meanwhile, the greenback could continue its decline in the short term, though the 110.00 figure should serve as a support area.
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