The Yen has managed a noted recovery overnight off a retrenchment in the Pound, Canadian and Dollar. Itis also possible that the Yen regained some safe haven interest in the wake of Chinese PMI readings that castdoubt on the pace of Pacific Rim trading activity. While we don’t see strong fundamental justification for asustained rally in the Yen, we can’t rule out a temporary rise on the charts and retest of overhead resistance up at98.21. More significant resistance is seen in the June Yen up at an old double top of 98.73.
Technical Outlook: Stochastics trending lower at midrange will tend to reinforce a move lowerespecially if support levels are taken out. A negative signal for trend short-term was given on a close under the 9-bar moving average. The upside daily closing price reversal gives the market a bullish tilt. It is a slightly negativeindicator that the close was under the swing pivot. The next downside target is 97.21. The next area of resistanceis around 97.63 and 97.80, while 1st support hits today at 97.34 and below there at 97.21.