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Forex: USD/JPY: Short-term outlook turning South - FXWW

By FXstreet.com,  January 08, 2013, 05:44:00 PM EDT

FXstreet.com (San Francisco) - The Japanese yen gained ground for a second day against the greenback Tuesday, as USD/JPY manages to extend its pulling back from recent 29-month highs at 87.20. Despite news of Japanese ESM bond buying Sean Lee, founder of FXWW says that the yen strengthens on 'broad-based profit taking'.

From Mr. Lee: "The focus today will again be on the Yen crosses, with AUD/JPY perhaps taking centre stage around the time of the retail sales data."

Mr. Lee continues: "USD/JPY is starting to retrace after an almost vertical rise from 79.00 and deeper pullbacks towards 85.00 certainly look possible. The short-term outlook is for a deeper retracement but it's dangerous to be selling weakness in such a vertical up-trend."

The 200-hr EMA (86.72) is offered as immediate support, a break of which could open scope for a retest of 85.50 support (April 2011 high). A slip below there would bring 38.2% retracement support around 84.10 in sight.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Forex and Currencies

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