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FxWirePro: USD/JPY goes for further range squeeze not breakout

The accompanying chart shows, what we exactly mean by the headline. USD/JPY, which has been trading in a narrowing range over the past two years or so, has once again bounced back after hitting the rising trend line.

Since 2015, USD/JPY has failed to break the declining trend line at least six times, while the rising trend line has provided support equal number of times. We, like many others in the market, have been anticipating a breakout for quite some time now. And, we have reiterated many a time now that our bet is on the downside.

We expect the USD/JPY to reach 108.5 area in the short-term, and to reach 101 per dollar over the longer horizon.

We recommend monitoring the pair closely for a looming breakout.

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