By Fast Brokers – The USD/JPY reacted negatively to disappointing U.S. UoM Consumer Sentiment data as the Dollar appreciated across the board. Today’s disappointing wave of data coupled with cautionary language regarding Greece’s economy and hawkish behavior in China spurred risk-averse movements in currencies which has carried over into the U.S. session. However, data from Japan hasn’t been too encouraging either and Finance Minister Kan has exhibited a more dovish monetary stance since taking office. Therefore, the USD/JPY is being pulled back and forth as investors debate which currency to favor for the time being, resulting in consolidation around 1/12 lows and what is now our 2nd tier uptrend line. That being said, the USD/JPY appears to be exhibiting somewhat of a positive correlation with gold and the Cable. Therefore, investors should monitor the Dollar for further broad-based appreciation since the USD/JPY may apt to participate more should more supports be taken out in the Cable and/or gold. Shirakawa will address the general public during Monday’s Asia trading session and investors will be paying close attention to see whether recent dovish statements from Kan have carried over to the BoJ. However, the wire will be quiet in the West on Monday, meaning activity may not pick up until Tuesday.
Technically speaking, the USD/JPY has our 1st and 2nd tier uptrend lines serving as technical cushions along with intraday lows and the highly psychological 90 level should it be tested. As for the topside, the USD/JPY faces multiple downtrend lines along with 1/14 and 1/12 highs.
Present Price: 90.79
Resistances: 90.75, 90.91, 91.15, 91.38, 91.55, 91.82
Supports: 90.54, 90.37, 90.24, 90.05, 89.86, 89.72
Psychological: 90, January highs and lows
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