USD/JPY flat despite risk rally
The conditions are nearly perfect for a rally in USD/JPY but the pair is stubbornly soft. A rally to 104.85 earlier has been beaten back and the pair is at a session low of 104.24, virtually erasing a gap higher at the open.
Looking at
the chart, the inability to hold any kind of bounce despite the drop
last week on the BOJ is a major red flag. Add in the positive risk
sentiment and recovering US yields and there's a strong case for shorts
here but it's tough to pull the trigger given the Brexit liquidity and
dangers.
Fundamentally, this report may have helped to cause a breakdown in the pair to session lows at 103.92 shortly after I wrote this post.
