The September Yen continues to lose safe-haven support this morning, and is looking increasing vulnerable to a sharp downside move over the rest of this week’s trading. Last night’s Japanese Retail Sales reading came in well below expectations, which does not bode well for tonight’s large selection of Japanese economic data points. Asian emerging markets appears to have found their footing for now, both with their currencies and with equities, which will create additional headwinds for the Yen during today’s trading. A still-hot situation in Syria and tonight’s Japanese data may keep the Yen well above last week’s lows for now, but it will difficult for prices to regain upside momentum unless global risk sentiment takes a decidedly negative turn over the next few hours. The September Yen may find near-term support just above the 101.50 area later during today’s session, and will need a revival of global risk aversion to recover any large portion of its recent losses before tonight’s data.
Technical Outlook
JPY (SEP): Stochastics trending lower at midrange will tend to reinforce a move lower especially if support levels are taken out. The close below the 18-day moving average is an indication the intermediate-term trend has turned down. The daily closing price reversal down puts the market on the defensive. It is a slightly negative indicator that the close was lower than the pivot swing number. The next downside objective is 101.52. The next area of resistance is around 102.94 and 103.65, while 1st support hits today at 101.88 and below there at 101.52.