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USD/JPY Back Below Y109.00. Focus on Y108.41 Support.

JPY
MNI (London)
  • Touched a recovery high of Y109.75 Tuesday before reversing tack, the rate easing through the day, but held shy of Y109.00 (low Y109.02), closing the day at Y109.06.
  • USD was seen under general pressure Tuesday, the release of stronger than forecast US CPI data was suggested to have been priced in and had little effect on risk appetite.
  • This was followed by a decent 10-yr auction in the US which eased yields and added weight.
  • Early Asia marked a high of Y109.08 before Tokyo provided the weight to take rate below Y109.00, the move prompting stale longs to cover back which took rate down to Y108.75.
  • Bids emerged into the dip, recovery though remained capped below Y109.00 (Y108.98) before fresh selling emerged into Europe, rate currently trades around Y108.82.
  • Support seen at Y108.75/65, a break to expose stronger level at Y108.41(Mar23 low)
  • Resistance remains at Y109.00/10 ahead of Y109.20/25.
  • Fed Powell and Clarida speak later today, 1600GMT/1900GMT respectively and seen as key events for USD direction.
  • MNI Techs: USDJPY remains vulnerable following the recent pullback from the Mar 31 high. The pair has traded lower today reinforcing the current bearish cycle and signalling scope for weakness towards 108.41, Mar 23 low and a key short-term support. The current pullback is likely a correction that is allowing a recent overbought trend condition to unwind. Initial resistance is at 109.96, the Apr 9 high.
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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