Although it has come through a bumpy overnight session near unchanged levels, the Yen continues to ahave a difficult time sustaining any move above the 98.00 level. With the Nikkei down 3.5% in the past twosessions, the Yen has been underpinned by domestic flight-to-safety flows. However, any chance that the Yencan extend this week’s rebound will depend upon US data coming in weaker than expected this morning. TheDecember Yen could see a retest of yesterday’s monthly high of 98.23, but it needs to find fresh sources of safehavensupport in order to build upon these recent gains.
Technical Outlook: Daily stochastics are showing positive momentum from oversold levels,which should reinforce a move higher if near term resistance is taken out. The close below the 9-day movingaverage is a negative short-term indicator for trend. The close over the pivot swing is a somewhat positive setup.The near-term upside objective is at 98.75. The next area of resistance is around 98.29 and 98.75, while 1stsupport hits today at 97.31 and below there at 96.79.