USD/JPY – Risk reversals retrace gains despite the breach of trend line hurdle
The Dollar-Yen pair closed yesterday above the resistance offered by the trend line sloping downwards from the March 10 high and July 11 high, still one-month risk reversals retracted gains.
One-month risk reversals
- The risk reversal gauge declined from -0.85 to -1.0 on Tuesday, suggesting increased demand for JPY calls (USD/JPY Puts).
- The decline in risk reversals indicates investors are not sure if the USD/JPY would be able to capitalize on the bullish break on the technical charts.