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14 Mar 2014
USD/JPY bid tone vanishing
FXStreet (Guatemala) - USD/JPY is drawing to a close for the week a great deal lower on risk aversion and it now sits below cloud support.
Analysts at TD Securities explained the USD/JPY looked in good technical shape through the end of last week but the bind tone has quickly vanished. Losses this week have dumped the USD back below “cloud” chart support, with the confirming cross lower in the “tankan” span indicating a bias towards more weakness from here. The USD is just about holding on to the base of the February/March consolidation range (possible “bear flag” signal) at 101.40 in late trading. We think weakness through 100.80, the early February lows, will point to more USD/JPY weakness in the short-term at least (towards 98). From here, the USD needs to recover through 103.30/50 to stabilize. For the week ahead, Strategists at RBS noted that BoJ Governor Kuroda speaks twice next week amid a strengthening JPY and softer domestic equity prices. “The BoJ minutes suggested that the Bank anticipates that the economic recovery will not be derailed by the sales tax hike. Kuroda has taken a largely neutral stance on monetary policy recently, but any comments on asset prices could increase expectations that the BoJ would react to counter a strengthening JPY or further drop in domestic assets”.
USD/JPY Levels
The 20 DMA is 102.36, the 50 DMA is 102.89 and the 200 DMA is 100.27. RSI (14) reads 40.46. Supports are ascending from 101.07 and 101.20. Spot is 101.40 while resistances are 101.54, 101.88, 102.17, 102.41 and 102.60.
Analysts at TD Securities explained the USD/JPY looked in good technical shape through the end of last week but the bind tone has quickly vanished. Losses this week have dumped the USD back below “cloud” chart support, with the confirming cross lower in the “tankan” span indicating a bias towards more weakness from here. The USD is just about holding on to the base of the February/March consolidation range (possible “bear flag” signal) at 101.40 in late trading. We think weakness through 100.80, the early February lows, will point to more USD/JPY weakness in the short-term at least (towards 98). From here, the USD needs to recover through 103.30/50 to stabilize. For the week ahead, Strategists at RBS noted that BoJ Governor Kuroda speaks twice next week amid a strengthening JPY and softer domestic equity prices. “The BoJ minutes suggested that the Bank anticipates that the economic recovery will not be derailed by the sales tax hike. Kuroda has taken a largely neutral stance on monetary policy recently, but any comments on asset prices could increase expectations that the BoJ would react to counter a strengthening JPY or further drop in domestic assets”.
USD/JPY Levels
The 20 DMA is 102.36, the 50 DMA is 102.89 and the 200 DMA is 100.27. RSI (14) reads 40.46. Supports are ascending from 101.07 and 101.20. Spot is 101.40 while resistances are 101.54, 101.88, 102.17, 102.41 and 102.60.