Forex: USD/JPY, up to a re-test of 90.55 resistance

By IBTimes Staff Reporter | January 28 2010 5:11 AM

FXstreet.com (Barcelona) - Dollar rebound from one-month low at 89.10 extended above 90.00 after Fed's monetary policy announcement and has rallied further on early European session to re-test of 90.55 resistance area (Jan 22,25 and 26 high).

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The pair is trading at the moment, around the 9-day moving average, which according to Nicole Elliott, senior technical analyst at Mizuho Corporate Bank, might cap the rally: Bouncing from 50% Fibonacci retracement support and the top of a relatively thin Ichimoku 'cloud'. Now let's see whether recent highs and the 9-day moving average will cap.

On a wider perspective, Elliott expects weakness to resume, pulling the Euro down to 88.25 area: We still expect a drop to 61% retracement (88.25) either this week or early next week.

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