The Yen has forged a slight recovery move overnight and that action might have been the result of shortcovering ahead of important developments in the Euro and US today. In fact, given the slide in the Yen over thelast two weeks and the potential for a pivot point in the currency markets off the ECB meeting and US payrolls onFriday, it is possible that some Yen shorts are banking profits and moving to the sidelines. In order to see the Yenresume its downward march on the charts, probably requires ECB easing and better than expected US initialclaims results. Traders might want to wait for a bounce in the June Yen back to 97.83 to get short the Yen again.
Technical Outlook: Daily stochastics declining into oversold territory suggest the selling may bedrying up soon. The market’s short-term trend is negative as the close remains below the 9-day moving average.The close below the 1st swing support could weigh on the market. The next downside target is now at 97.07.Some caution in pressing the downside is warranted with the RSI under 30. The next area of resistance is around97.54 and 97.75, while 1st support hits today at 97.20 and below there at 97.07.