The dollar has been hit hard by investor concerns that a divided Congress could imperil the White House's fiscal agenda but the resilience in USD/JPY could provide a refuge for dollar longs.
The USD index, which tracks the dollar versus a basket of six currencies, has sunk well below the 95.995 Fibo, 50 percent retrace of the 94.789 to 97.201 recent up-leg.
A USD index daily close under the 95.995 Fibo would be ominous for dollar longs .
However, despite widespread weakness in the dollar, USD/JPY has so far held up quite well.
There has been talk that Japanese investors and some central banks are on the bid in USD/JPY just below 113.00.
Solid technical support is propping up the market at 30-DMA, now at 112.90.
Also the thick daily cloud, which spans 112.16-112.93, should provide significant platform from which USD/JPY longs can build.
IMM data for the week ending Oct.
30 showed a futures market long an equivalent cash USD/JPY position of $10.1 billion, marginally trimmed from $10.3 billion the previous week.
There is some evidence from EBS flow data that USD/JPY longs have now been trimmed further, giving remaining longs more room to manoeuvre higher.