Forex: USD/JPY tests daily lows

By IBTimes Staff Reporter | January 22 2010 2:58 PM

FXstreet.com (Córdoba) - The Yen is testing intra-day highs across the board as stocks are falling sharply in the US for the third consecutive day. USD/JPY is back below 90.00 and trades at 89.85/90, 0.63% below today's opening price. To the downside support lies at 89.75 (intra-day low) and below at 89.50/55.

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The pair is headed toward the third consecutive week with negative performance. The Dollar has accumulated a decline of almost 400 pips since it rose to 93.75 on January 7.

EUR/JPY was rejected from levels above 128.00 and currently is testing a support zone at 127.00. The pair tumbled during the Asian session to 126.50, the lowest price since April.

Regarding EUR/JPY, James Chen, chief technical analyst at FX solutions affirms: (it) has descended all the way down to reach and dip below key support around the 127.00 price region. This occurs within the context of a prolonged sideways trading range that the pair has been entrenched in since at least mid-2009.

A strong breakdown and daily close significantly below the noted support around 127.00 could potentially indicate additional bearish pressure targeting further downside support targets, James says, as he locates at 122.00 a key longer-term bearish target.

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