The economy of the United States grew slower than expected in the first quarter. U.S. Governments spent less, and businesses cut back on investment. But consumers spent at the fastest pace in more than a year.
Dollar weakened and Japanese yen rose on the news. The yen also gained amid concerns that new Bank of Japan stimulus won’t be enough to boost Japan’s growth.
USDJPY currently trading at 80.41 approaching a previous support of 80.27 close to the lower band of the Ichimoku cloud. A break below the support level could open the door for further declines of the dollar versus the yen.
On a sentiment point of view, the SSI (Speculative Sentiment Index) shows that retail trading crows are heavily long on the dollar. The SSI is contrarian indicator and signals more USDJPY losses.
By Kiana Danial at Forex Diva