Long USD/JPY: Trade of the week: RBC

By FXStreet FXStreet (Delhi) – Research Team at RBC, suggests long USD/JPY pair as the trade of the week.

Key Quotes

“This week brings most of the remaining first-tier data releases and Fed speakers (November payrolls and Yellen’s testimony) ahead of the September 16 FOMC meeting.”

“Once these hurdles are cleared, we think it more likely the ~70% probability currently attached to a December hike will rise toward 90% than fall toward 50%. Rising Fed hike expectations have so far generally been accompanied by rising risk appetite (the mirror image of the September experience) and if this continues we expect a combination of USD strength and “risk-on” markets this week, with the latter further supported by aggressive ECB easing.”

“This should be a constructive background for USD/JPY pushing through the November
highs.

• Long USD/JPY position established at 122.82

• Target 125.00

• Stop at 121.60
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Source:: FX Street