USD/JPY: Plenty of volatility, perfect for the day-traders

• Position unwinding ahead of August holiday period is main factor at play here.
• Latest data shows Yen shorts had again been increasing sharply and we saw a sharp unwind on Friday.
• The USD remains under pressure ahead of an important data week and more FOMC.
• Yen crosses look mixed and volatile consolidation is favoured rather than any big trend moves.
• Fairly quiet start in early interbank trade saw a quick push to test levels below 98.00.

The Yen looks oversold and with the market short and probably looking to cover before holidays begin, I still favour the short-side in USD/JPY. But, its already fallen sharply so you need to pick your levels very carefully. Of all the major pairs, this is the one that seems most suited to the day-traders.