USD/JPY: things are heating up and getting bullish – TDS

By FXStreet Analysts at TD Securities noted that event risks are building across G10 markets over the next several weeks.

Key Quotes:

“While focus remains on the UK referendum and June FOMC meeting, Japan has its share of potential catalysts.

These will keep JPY as a main market focus. The upcoming G7 summit, sales tax decision, and further details on other policy initiatives all have the potential to become significant drivers for the JPY in the period ahead.
We are turning more strategically bullish on USD/JPY. We look for a gradual move toward—and perhaps above—our end-year forecast of 115. We are now operating on the basis that the 3 May low is the trough for the correction that has unfolded since the 125.86 level over the last year.

This will not happen in a straight line, however. Indeed, from a tactical perspective, we think USD/JPY is approaching a near-term top. We think 110.67 may provide resistance ahead of the 28 April high at 111.88.

With the rise off of 19-month lows at 105.56 looking a little stretched at this point, we are looking for a pullback. We think this could find a base in the 107.05/50 zone before turning higher on a more sustained basis. …read more

Source:: FX Street