USD/JPY: Credit Agricole bank believes there is an opportunity to go long on pair

"The USD/JPY pair is consolidating at this time as investors focus on other G10 currencies like the AUD/USD and EUR/USD. The volatility of the JPY is lower and this, in our opinion, provides opportunities to go long.

A combination of factors seem to prevent the USD/JPY from breaking out and up through 125. One of the most important factors is the recent comments by the BoJ and the IMF who believe that the JPY depreciated considerably in the last quarter. On the other hand, Governor Kuroda and his MPC colleagues continue to not be alarmed by the low inflation, reducing market expectations in terms of new QE.

But industrial production figures and industrial orders are expected to weigh down on growth forecasts and add to the BOJ's concerns, in our view.

These statistics could have a strong impact since we are no longer far from the Q2 growth figures (17 August), especially as China is slowing down", says Credit Agricole.