The September Yen remains under severe pressure this morning, and has already fallen below last week’s lows during today’s session. Yesterday’s FOMC meeting minutes started a migration of safe-haven support across the Pacific into Dollars, and positive “flash” PMI readings out of China and the Euro zone are adding to today’s early Yen weakness. Japanese equities remain sluggish while Asian emerging market currencies and stock markets are still getting clobbered, so the Yen may find enough of a flight-to-safety inflow to avoid a severe downdraft late this week. With surging US longer-term yields providing the Dollar with the upper hand, however, the Yen is likely to lose further ground during today’s trading session. The September Yen may slide down towards the 101.10 level later today, and at this point needs to see fresh risk concerns from several global regions in order to put the brakes on this current sell off.
Technical Outlook
JPY (SEP): Stochastics trending lower at midrange will tend to reinforce a move lower especially if support levels are taken out. The market back below the 18-day moving average suggests the intermediate-term trend could be turning down. The swing indicator gave a moderately negative reading with the close below the 1st support number. The next downside target is 101.49. The next area of resistance is around 102.72 and 103.30, while 1st support hits today at 101.82 and below there at 101.49.