USD/JPY: Upside Prevails
USD/JPY is to consolidate with bullish bias after hitting 28-month high of 86.36 this morning underpinned by negative JPY sentiment on expectations for aggressive measures from Japan’s new leaders to tackle deflation and rein in the yen’s strength. USD/JPY is also supported by demand from Japan importers and investment trusts, improved risk appetite (DJIA pared losses of as much as 151 points overnight to close down 18 points) after reports that U.S. House of Representatives will return to Congress on Sunday, and raising hopes for a last-minute deal to avert the U.S. fiscal cliff. But USD/JPY gains tempered by Japan exporter sales, drop in U.S. Conference Board consumer confidence index to 65.1 in December from a downwardly revised 71.5 in November, and positions adjustment before weekend.
1445 GMT U.S. December ISM – Chicago PMI
1500 GMT U.S. November pending home sales index.
Buy above 85.85 with 86.8 and 87 in sight.
R1 – 86.8
R2 – 87
R3 – 87.2
Sell below 85.85. The downside penetration of 85.85 will call for a slide towards 85.65 and 85.45.
S1 – 85.65
S2 – 85.48 (Thursday’s low)
S3 – 85.2
The pair has broken above its previous high and should post further advance. USD/JPY daily chart positive-biased as MACD bullish, stochastics stays elevated at overbought, 5- & 15-day moving averages are rising.
The material has been provided by Instaforex Company – instaforex.com