The Japanese yen hit its 10-days low against the USD and some major currencies today, after Japan Finance Minister Taro Aso warned about Tokyo’s readiness to perform market intervention if needed. The rise of risk appetite pushes down the demand for safe haven currency.

The Japanese yen touched its strongest level in 18 months against the USD last week, following 15% gain in the last 6 months, partially was triggered by doubt on Fed rate. Besides Aso, Japan Prime Minister Shinzo Abe last week said that he was watching the yen’s movement and will act if necessary.

USDJPY 9 MAY 2016 FOREX.TODAY

From technical analysis point of view, USD/JPY currently is in upward trajectory, testing intraday key resistance at 108.597. If the price managed to break the resistance, the rally possibly will extend to 109.188-109.682. However, note that hourly stochastic has crossed down and CCI is falling from the overbought area. This condition may be followed by correction move. In that case, as alternative strategy watch for bullish signal confirmation on a pull-back move to within the Fibonacci support area at 107.768-107.255 with 108.085 as target and 108.597 in extension.

Please be careful if the price managed to break the support at 107.255 because it will turn the intraday bias to bearish and possibly will be followed by deeper bearish move to 106.891-106.426. In that case, the bullish scenario mentioned above possibly will fail.

One thought on “USD/JPY Tests Resistance, Correction Is Possible; May 9, 2016”

  1. Ryan Gandalf van Jaarsveld says:

    Thanks Eko

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