The Yen has seen a subtle shift in sentiment in favor of the bear camp as the actions of several centralbanks has quelled safe haven interest. While the head of the IMF overnight suggested that tightening monetaryconditions will adversely impact emerging market economies, the Fed would argue that tapering isn’t tightening, itis simply removing excess liquidity measures. With calls for a continuation of bold BOJ support for the Japaneseeconomy overnight from a Japanese official and a US Fed that is widely expected to trim another 10 billion fromUS asset purchases, the Yen might weaken initially before finding support down around 96.50. However, shortswill have to watch the reaction in emerging markets to news of another US taper, as that could rekindle safehaven interest in the Yen tonight.
Technical Outlook: Rising stochastics at overbought levels warrant some caution for bulls. Themarket’s close above the 9-day moving average suggests the short-term trend remains positive. The market’sclose below the pivot swing number is a mildly negative setup. The next upside objective is 97.91. The next areaof resistance is around 97.56 and 97.91, while 1st support hits today at 96.86 and below there at 96.51.