USD/JPY Floats Below 90
The USD/JPY is fluctuating below the highly psychological 90 level as FX markets cool down in the wake of last week’s heavy volatility. Although the USD/JPY was holding up relatively well, the currency pair finally gave in to downward forces as investors exited the risk trade in a flurry. Debt scares in Greece and Portugal combined with mixed global economic data sent bulls to the exits with the Cable and EUR/USD registering hefty pullbacks. The USD/JPY was performing relatively well for a while since the BoJ’s dedication to fight deflation managed to counter the flight to the Dollar. Furthermore, recalls from Toyota has placed a downward pressure on Japanese equites, a negative development for the Yen. However, the USD/JPY slid late Thursday as the decline in the risk trade accelerated and the USD/JPY is currently attempting to stabilize. The data wire will be relatively quiet until China’s New Loans and Trade Balance data tomorrow morning. Japan will also release Core Machinery Orders data during Wednesday’s Asia trading session, giving investors an idea of how industrial production is faring. Meanwhile, investors should keep an eye on the news wire for further developments in the EU regarding Greece’s fiscal woes.
Technically speaking, the USD/JPY still has multiple uptrend lines serving as technical cushions along with 1/27, 2/5 and 2/4 lows. As for the topside, the USD/JPY faces multiple downtrend lines along with 2/5 highs and the highly psychological 90 area.
Present Price: 89.45
Resistances: 89.64, 89.72, 89.88, 89.99, 90.17, 90.32
Supports: 89.37, 89.13., 89.00, 88.89, 88.78, 88.63
Psychological: 90, February highs and lows
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