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USD/JPY Tests Y109.00 Ahead of Golden Week/FOMC

JPY
MNI (London)
  • Recovery extends to touch Y109.00 with corrective pullbacks so far holding very shallow.
  • Asian traders have noted that the Japan retail sector have shown decent interest to buy into the recent dips, going long into the upcoming Japan Golden Week holidays (Thursday, Monday, Tuesday, Wednesday).
  • Resistance is seen at Y109.00, Y109.01 (61.8% Y109.96-107.48), a break here to expose Y109.23(50% Y110.97-107.48) ahead of Y109.37/42(76.4% 109.96-107.48/Upper 1.0% 10-dma envelope) and Y109.64(61.8% Y61.8% 110.97-107.48).
  • Support Y108.40/20.
  • Of note, $1.2bln of Y109.00 USD puts roll off at Thursday's NY cut.
  • Today is month-end value so can expect some US corporate USD demand to emerge into the NY session, but positioning ahead of FOMC and Biden could counter effects.
  • MNI Techs: USDJPY traded below pivot support last week at 107.77, a trendline drawn off the Jan 6 low. This week's recovery though suggests the trendline has remained intact and a bullish theme appears to be developing. Price has traded above the 20-day EMA at 108.69 and further gains would open 109.96, Apr 9 high. On the downside, 107.48, Apr 23 low is key support. A break would resume the recent bearish pressure.
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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