Yen traders encouraged by further rise in Japanese currency

Traders are encouraged by the further strengthening of the yen, which has recently been under pressure.

The dollar-yen pair broke the uptrend and is paving the way for further decline. From the low reached by the currency back in October, the yen railed almost 8% against the dollar.

According to Pepperstone Group Ltd, traders are keeping a close eye on the November lows for the dollar-yen pair. A breach of this currency pair could start a bearish trend at 134 yen per dollar toward the pair's 200-day moving average.

In a note, head of research Chris Weston wrote that clients are perfectly split on short-term direction. A closing break below the lows of November would probably see momentum accounts look to increase short exposure.