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FxWirePro: USD/JPY largely range-bound, sees strong support at 110.75

  • USD/JPY has bounced off from multi-month lows at 110.66 on 17th March, but is seen strugling to extend gains.
     
  • The major is extending range trade, and we see further weakness on breach of 110.75 support.
     
  • CFTC speculative positioning for the week ending 15 March 2016 showed that long USD positions reduced sharply.
     
  • Leveraged funds increased their net JPY longs for a fifth consecutive week by a further USD1bn to USD4.6bn, a new high in this cycle.
     
  • Major calendar events this week which could influence the pair include US Durable goods (Thursday), Q4 GDP (third estimate) (Friday), Japan CPI Y/Y (Thursday).
     
  • Tehnical indicators are inconclusive, momentum studies are neutral, weakness only on breaks below 110.75.

Resistance Levels:

R1: 111.75 (Mar 18th highs)

R2: 112 (5-DMA)

R3: 112.26 (Feb 24th highs)

Support Levels:

S1: 111.04 (Feb 24th lows)

S2: 110.97 (Feb 11th lows)

S3: 110.75 (Trendline)

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