Apparently the Yen is not seeing rising concern of global slowing ahead as the liquidation wave continues. We think the bear camp is set to see increased technical and fundamental risk in the wake of Chinesesuggestions they will simply avoid a hard landing, from ongoing signs of deflationary Euro zone data and mostimportantly the Yen trade also seems to be discounting the potential for US government debt problems. We don’twant to buy the Yen but shorts might consider implementing tight profit stops.
Technical Outlook: The market was pushed to a new contract low. Daily stochastics declininginto oversold territory suggest the selling may be drying up soon. The close below the 9-day moving average is anegative short-term indicator for trend. The close below the 2nd swing support number puts the market on thedefensive. The next downside objective is 93.01. With a reading under 20, the 9-day RSI indicates the market isextremely oversold. The next area of resistance is around 93.94 and 94.50, while 1st support hits today at 93.20and below there at 93.01.