Medium-trend Yen recovery likely but call ratio spreads hedge major trend

Since it has been closely monitored the USD's fluctuations technically and its fundamentals, uptrend on USDJPY is intact.

RSI (at 61.9618) evidencing bullish convergence even though bear candles appear in between.

While %D line crossover occurred to indicate for minor dips only which could be utilized as optimal buying opportunities. (%D line at 75.0698 & %K line 61.8206).

Volumes are confirmed on every bearish candlestick whereas bull candles are not fortified by volumes. But this may only impact on medium term momentum.

Constant cash-inflow can be figured out as MFI stirring in convergence with price demand for dollar.

We also reiterate any necked positions are not advisable even though you expect medium term slumps as big event is underway on US side which may strike a chord on long term hedgers.

Long term derivatives hedging outlook:

Overview: Sideways or slightly bearish in short term but bullish in long term

USDJPY is moving in sync with sensitive economic outcomes. As the saying goes this way "never buck the trend" in our opinion the pair is likely to remain either sideways or slightly bullish in long term. We therefore recommend "call ratio spread".

Buy 6M (1%) OTM Call and buy near month ATM put options. Use price any dips which are likely to add longs on calls so to make enhance profitabilty.

This would likely to result in a stiff hedge in long term upside risks and a safe attractive profitability for traders in short term downside risks.