BOJ comments overnight suggest that the Japanese economy is recovering and that Japan will be able tohit its 2% inflation target and that could underpin the Yen. However, with somewhat higher US equities and arecovery in the Dollar, it would seem like the dominating safe haven influence from yesterday has been tampeddown to start the Tuesday trading session. On the other hand, a resumption of safe haven flow into the Yen couldbe seen in the event that US data later this morning comes in soft from a regional manufacturing report. A normalcorrective setback in March Yen could target 98.22 but the key pivot of the day will come right after an earlyspeech from the US Fed’s Lacker.
Technical Outlook: Daily stochastics have risen into overbought territory which will tend tosupport reversal action if it occurs. The market’s short-term trend is positive on the close above the 9-day movingaverage. There could be more upside follow through since the market closed above the 2nd swing resistance.The next upside objective is 100.40. With a reading over 70, the 9-day RSI is approaching overbought levels. Thenext area of resistance is around 99.94 and 100.40, while 1st support hits today at 98.34 and below there at97.20.