Although it is only finding moderate pressure this morning, the Yen’s key reversal from Tuesday’s lowappears to have run out of steam as it fell just short of retesting last Friday’s 98.11 high before sliding backtowards the downside. Aggressive BOJ easing continue to weigh heavily on the Yen, as a sharp drop in Japaneseequities provided little benefit for prices going into this morning’s trading. Weak US data may be the Yen’s besthope for shaking off early pressure, but will still have limited upside until it can find additional sources of safehavensupport. The December Yen may slide down towards the 97.35 level later today, but traders should wait fora rally back towards the 98.04 level before approaching the short side of the market.
Technical Outlook: The sell-off took the market to a new contract low. The daily stochasticsgave a bullish indicator with a crossover up. Daily momentum studies are on the rise from low levels and shouldaccelerate a move higher on a push through the 1st swing resistance. The close below the 9-day moving averageis a negative short-term indicator for trend. The daily closing price reversal up is a positive indicator that couldsupport higher prices. A positive setup occurred with the close over the 1st swing resistance. The next upsideobjective is 98.86. The next area of resistance is around 98.33 and 98.86, while 1st support hits today at 97.01and below there at 96.21.