USDJPY - short squeeze likely

After the BOJ intervention, we are back to where we started and USDJPY is about to run into 116. Friday's US data and an increased likelihood for a rate hike in March may keep the USDJPY from breaking lower.

Last time we saw an immediate reaction trading into 116. We expect to see more volatility this time since the re-visit has come earlier than expected. Expect to see orders below 116 so a drive lower before going higher could be a potential scenario.

Yellen's comments next week will determine how the USDJPY will react down there. Risk appetite with a focus on China and Crude need to be considered when trading the USDJPY as well.