USD / JPY Trading Outlook
USD/JPY was unable to break the 78.30 resistance, as expected it was a tough barrier to pass, and since the pair has retraced back to 77.60 as the USD weakens. Off this retreat, from a technical stance, there is a preference to sell from the 77.95 level as the pair remain under pressure and looks to challenge its 77.45 support.
USD/JPY is on the move moving from 77.00 to above 78.00 which is the high of the month. The pair may face a barrier here as previous tests (Nov 29th, Dec 4th, 14th, 22nd 2011) all failed to break the 78.00-78.30 zone but a spike through may cause stops to be triggered and hence push the price up further so trade cautiously at that level. On the other-hand if it retraces down to 77.55/65 and the level holds there is a preference to buy. EUR/JPY also rallied, continuing in its uptrend, posting 101.90 highs. Some stops have been taken out and there are more eyed at 102.00 and 102.60.
USD/JPY broke the 77.05 resistance this morning triggering stops up to 77.30. This has created the 77.05 pivot point and now there is a preference to buy here, as long as the level holds, with the RSI above its neutral area at 50%. To the topside 77.55 is the initial resistance with offers starting at 77.40. EUR/JPY broke 100.00 to the topside in yesterday’s trading and has managed to hold above this, there are bids from around 100.00 from weak shorts (source: IFR) with stops eyed below 99.75 and above 100.50. There is a preference to buy ahead of stops at 99.80 whilst managing any risk to the downside if the level breaks lower and the profit target is 101.00.
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