A Japanese market holiday is helping to keep the Yen in a fairly tight early trading range, but last Friday’sreversal from multi-year low should provide some near-term underlying support this morning. While calmer marketconditions in China and around the globe has dampen the flow of safe-haven support, end-of-quarter and end-ofyearshort-covering will provide an additional source of strength to the Yen early this week. There are stillwidespread expectations for much lower prices levels in 2014 but with thin trading conditions raising theprospects for a sizable near-term bounce, traders should wait for a decent near-term rally before approaching theshort side of the market heading into year’s end. The March Yen may rise up towards the 96.52 level later intoday’s session, and would need to see some robust US economic numbers to see any retest of last Friday’s lowfor the move.
Technical Outlook: The market was pushed to a new contract low. Daily stochastics declininginto oversold territory suggest the selling may be drying up soon. The close below the 9-day moving average is anegative short-term indicator for trend. The upside closing price reversal on the daily chart is somewhat bullish.The market has a slightly positive tilt with the close over the swing pivot. The next downside target is 95.32. Thenext area of resistance is around 96.49 and 96.77, while 1st support hits today at 95.77 and below there at 95.32.