USDJPY: Weak daily volatility constitutes major obstacle to pronounced rebound - Natixis

According to Micaella Feldstein, Research Analyst at Natixis, the weak daily volatility constitutes a major obstacle to a pronounced rebound of the USD/JPY over the next few trading sessions.

Key Quotes

“Under these conditions, a breakout above the resistance around 118.60-118.80 (upper band of daily Bollinger) should prove difficult. Rather, the pair can be expected to eye the support at 115.20 (lower band of daily Bollinger).”

“Keep an eye on this last level: if it gives, this would release significant downside, opening the way for a more pronounced downward correction towards 114-114.22 (9-week moving average) before the supports at 112.30 (Fibonacci projection) and 111.20 (38.2% Fibonacci retracement of 99-118.66 wave from June to December 2016).”