Here’s something different or at least slightly so. The Japanese Yen continues to gain against the US Dollar despite hawkish comments on Tuesday from the Federal Reserve. The USD/JPY has retraced more 50% of the move between its 10-year low and high. The 100 level will be a psychological test for it, but real support lies @ 99.00 and 96.50. Should these levels fail, then the 61.8% level @ 94.77 becomes another key test.
Aside from these technical analysis comments, there are no solid fundamental reasons for the Yen to be outperforming the dollar, especially in the face of a Fed bias towards raising rates before year-end of 2016. Then again, one should never underestimate the collective wisdom of the markets and there are some amongst investors and traders who believe that pockets of economic weakness in the USA and ongoing weakness and deflationary pressures in the global economy suggest otherwise.