By Fast Brokers – The USD/JPY is undergoing one of its common consolidation phases around the psychological 94 area as the FX markets start off the week on a relatively quiet note. Thus far the EU/IMF rescue package for Greece has yielded a muted reaction in the Euro and other major dollar pairs, although we’ll have to see how they behave when the U.S. markets open. Meanwhile, the USD/JPY is holding above the downtrend line running through April highs, a positive sign momentum wise. However, the USD/JPY still does need to tackle those April highs along with its psychological 95 level. The data wire is pretty tame today outside of America’s manufacturing PMI figure due later. Since Japan will be on a banking holiday Tuesday and Wednesday, this leaves the USD/JPY in the hands of psychological forces and key events such as U.S. employment data and Thursday’s ECB meeting and parliamentary election. The technicals look positive for the USD/JPY barring a development triggering broad-based risk aversion. Should the risk trade regain some of its confidence as the EU rescue package digests then this may benefit the USD/JPY. However, considering there’s a plethora of key news this week the tide could really turn in either direction.
Technically speaking, the USD/JPY faces technical barriers in the form of previous April highs. As for the downside, the USD/JPY has multiple uptrend lines serving as technical cushions along with intraday, 4/23, 4/22, and 4/19 lows. Additionally, the psychological 93 level could continue to serve as a psychological cushion should it be tested.
Present Price: 94.06
Resistances: 94.11, 94.20, 94.33, 94.52, 94.66, 94.79
Supports: 93.88, 93.73, 93.60, 93.45, 93.29, 93.04
Psychological: .94, .93, April highs and lows
(click chart to enlarge)
Market Commentary provided by Fast Brokers.
Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regarded neither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.
Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.
