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The pair’s upside momentum could extend to the 113.75 level, suggested Chief Analyst at Danske Bank Arne Rasmussen.

Key Quotes

USD/JPY yesterday broke above the high from July at 113.19 driven by general USD strengthening and risk appetite”.

“The Summit meeting between Prime Minister Abe and US President Trump has decreased the near-term risks for the cross as an escalation of the trade tensions between the US and Japan appears to have been avoided”.

“With no yen-related risk factors in sight near term, risk appetite is likely to be directional for the cross. Investors are very short JPY, according to the latest IMM data, indicating a high correction risk”.

“Technically, resistance is seen at 113.75, 114 and around 114.50, while the key support level is likely to be found just below 111 at the 100-day moving average line”.