While yesterday’s chaotic trading session provided the Yen with a monthly high and low in less than 6hours, it may be the swift reversal of the downside breakout below the May-November “triangle” chart formationthat provided the most lasting benefit for Yen prices going into this morning’s trading. Strong Chinese exportnumbers have eroded the Yen’s safe-haven support this morning, but a negative reception for today’s US jobsdata will create a fresh source of flight-to-safety flows. Longer-term upside may be limited by the BOJ’s ongoingeasing measures, but the Yen will likely remain a main beneficiary of fresh global risk concerns going forward.The December Yen could climb up towards the 102.27 level later today, but a move beyond yesterday’s spikehigh would need some fairly bleak US jobs numbers.
Technical Outlook
JPY (DEC): The major trend could be turning up with the close back above the 60-daymoving average. The daily stochastics gave a bullish indicator with a crossover up. Rising from oversold levels, daily momentum studies would support higher prices, especially on a close above resistance. The cross over andclose above the 18-day moving average indicates the intermediate-term trend has turned up. The outside day upand close above the previous day’s high is a positive signal. Since the close was above the 2nd swing resistancenumber, the market’s posture is bullish and could see more upside follow-through early in the session. The neartermupside target is at 103.63. The next area of resistance is around 102.94 and 103.63, while 1st support hitstoday at 101.09 and below there at 99.92.