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Back Above Y109.50 Keeps Upside in Favour

JPY
MNI (London)
  • USD/JPY recovery extended Friday to Y109.85(Jun05-2020 high) before move met decent resistance and backed off to Y109.53 at the 1600GMT fix. Rate recovered through the NY afternoon, settling between Y109.60/70 into the close.
  • Rate nudged to Y109.80 in early Asia before Tokyo fix related selling emerged (USD/JPY and JPY crosses), with talk some of the interest linked to month/FY end Wednesday.
  • Move lower ran into reported demand around the Y109.40 level (low traded Y109.37) before rate recovered to Y109.53 in early Europe.
  • Month-end value today which could see US corporate USD demand emerge in the NY session. Early month-end models suggest USD/JPY demand to be seen at Wednesday's fixes. These events, along with Japan retail demand, and IMM and leverage dip demand interest likely to keep rate buoyed, though the pullback below Y109.50 has caused a slight wobble in the current uptrend tone.
  • Support Y109.37/30 ahead of Y109.15/00. Resistance Y109.85, Y109.95/98(1.618% swing 109.36-108.41/5-yr falling resistance), with the top of the 1.0% 10-dma envelope coming through at Y110.10.
  • MNI Techs: USDJPY rallied to a fresh 2021 high Friday. The move above 109.36, Mar 15 high confirms a resumption of the uptrend and note that 109.56 has been breached, a key retracement - 76.4% of Mar 2020 - Jan downleg. Attention is on 110.00 and the 110.63 Fibonacci projection. Overbought conditions are still not impacting this trend and instead continues to reinforce current sentiment. 108.41 is the key short-term support.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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