More coiling in the Yen would seem to deflate the bull case but in general the Yen has managed to extend the pattern of higher lows and higher highs. However, seeing positive equity market action, strength in the Euro and signs that the PBOC is actively supporting the Chinese economy could temper the safe have flow toward the Yen. We can’t argue against more minor step-wise gains in the Yen, but we don’t see a noted influx of buying ahead. Support in the March Yen moves up to 85.08.
Technical Outlook: The crossover up in the daily stochastics is a bullish signal. Momentum studies are rising from mid-range, which could accelerate a move higher if resistance levels are penetrated. The market’s close above the 9-day moving average suggests the short-term trend remains positive. The daily closing price reversal up is a positive indicator that could support higher prices. The close over the pivot swing is a somewhat positive setup. The next upside target is 85.87. The next area of resistance is around 85.69 and 85.87, while 1st support hits today at 85.05 and below there at 84.60.