USD/JPY Daily

Resistance 3: 105.00/10

Resistance 2: 104.80

Resistance 1: 104.40/50

Latest New York: 104.24

Support 1: 103.20/30

Support 2: 103.00/102.90

Support 3: 102.50

Comments

Late rally shows upside bias still working. Rally into the 104.80 area is the best potential short area in my view. COT data showing an increase of net JPY longs making the upside potential for the USD a bit higher in my view. Stops above the 104.10/20 area likely to be in size and the question is how big are the offers ahead of 104.40? Stops the other side of 104.50 said to be in size suggesting that speculators got heavily short near current market pricing as 104.50 area is in range with the recent weekly highs. This week’s data may support near-term as the USD has had a lot of bad press the past quarter and has managed a firm start to the year; perhaps the Yen has a further downside correction to go before the USD bears are again out in force. If this weeks’ data is USD supportive then the rate has a pop higher into resting offers coming. Watch the upside volume for clues to the speed of the rally; if it is coming.

Data due Wednesday: All times EASTERN (-5 GMT)

Tentative JPY BOJ Governor Shirakawa Speaks

7:50pm JPY Retail Sales y/y 0.5%

7:50pm JPY Large Retailers' Sales y/y -1.1%

Analysis by: Forexpros.com written by Jason Alan Jankovsky

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