The pair started the morning on a relatively firmer footing, with dollar-yen seeing an early gap down to Y103.02 from around Y103.22 while euro-yen started at Y142.78. The early risk-off tone was attributed to worries about the overnight drop in commodities and metals prices, while fears of further Chinese corporate bond defaults also dragged yen crosses lower. Dollar-yen traded a low of Y102.78 while the cross slid to Y142.39 just minutes before the Japanese stock market opened. Despite the Nikkei 225 opening down over 1.4%, dollar-yen ran into demand from Japanese names off the early low,from Y102.50 and Y102.20, squeezing some of the earlier sellers and prompting a rally back through the Y103.02 opening level. Dollar-yen traded up to a Y103.10 high as the cross also recovered to Y142.88. The yen market stabilized a bit after that with dollar-yen continuing to hold off the high at Y102.98 last while euro-yen was at Y142.68. Initial dollar-yen resistance is noted at the Y103.15 previous support with small stops above. More stops are noted above Y103.50 with a close above needed to see immediate focus back on the Y103.80-85 region.
