USD/JPY Dips Continue to be Bid Into Amid Market Uncertainty

USD/JPY has been experiencing a series of dips that continue to be bid into, according to City Index UK. These dips have occurred after major economic events such as the NFP print in the US and the announcement from the US Treasury that buybacks would be increased on long-dated Treasuries.

Despite these shocks, the fundamental skew remains to the long side, with US inflation at 3.4% and Japanese inflation coming in at 1.9%. The carry trade still appears to be in favor of the USD/JPY pair, even with rumors of a September rate hike from the Bank of Japan.

Market analyst James Stanley notes that buyers have continued to shy away from resistance at the 160 handle but repeatedly pressed higher-lows after pullbacks. This sets the stage for a possible showdown as markets continue to test until they're forced to follow another path.