FxWirePro: USD/JPY remains open to further rise; retail sentiment in favor

After yesterday’s brief respite, the yen is once again under pressure against USD,

• With risk aversion easing somewhat, the yen is once again under selling pressure on broad-based USD strength.
• Yesterday, Yen strengthened to as high as 111.6 per USD, but today it is back as 111.9 area.
• USD/JPY bulls knocking at 112 psychological resistance.

Retail sentiment remains in favor of further yen weakness,

• The sentiment reports from IG Markets, which is a UK-based company providing trading in financial derivatives such as contracts for difference and financial spread betting, strongly suggest that yen is likely to decline against the USD.
• IG markets’ retail positions data provide a glimpse to retail traders’ positions, which are largely used a contrarian indicator since retail positioning moves in opposite direction to market movements.
• As of today, according to data from IG markets, 63 percent of retail positions are bullish on yen, while only 37 percent are on the short side, suggesting further downside possibility for the yen against the USD.