We would not expect the Yen to show much direction today unless the US numbers are better thanexpectations and then the Yen might see some modest pressure. In the event US data is weak we suspect thatshort covering action will lift the June Yen toward 98.10. Another indirect limiting force for the Yen today is newsthat the PBOC is poised to reduce its RRR when appropriate. Pushed into the Yen we would be a seller of minorrallies today.
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.Market positioning is positive with the close over the 1st swing resistance. The next downside target is now at97.21. The next area of resistance is around 97.84 and 97.97, while 1st support hits today at 97.46 and belowthere at 97.21.