Next longer term support on the weekly charts is seen about 55 points below this morning’s early trading levels. Seeing Japanese factory output and consumer spending decline in August leaves the Yen headed down tothe 2008 consolidation low zone that sits just above the 90.50 level on the weekly charts. Some are suggestingthat protests in Hong Kong and the threat of even more slowing in China, in the event of a government crackdowncould chill economic activity in the region and that is another element contributing to the downward bias in theYen.
Technical Outlook: The sell-off took the market to a new contract low. The daily stochasticsgave a bearish indicator with a crossover down. Daily stochastics declining into oversold territory suggest theselling may be drying up soon. The close below the 9-day moving average is a negative short-term indicator fortrend. The market’s close below the pivot swing number is a mildly negative setup. The next downside target isnow at 90.91. The 9-day RSI under 20 suggests the market is extremely oversold. The next area of resistance isaround 91.65 and 91.92, while 1st support hits today at 91.15 and below there at 90.91.