USDJPY: With a third consecutive week of downside weakness seeing USDJPY breaking through the 90.59/23 levels(Dec 21'09/Jan 15'10 lows) to close lower at 89.80 the past week, further decline is likely to be seen towards the 88.30 level, its Dec 14'09. The pair may find a breather at this level and initiate some form of correction but if that fails to materialize, we could witness additional downside losses towards its Dec 09'09 level at 87.35 with a decisive violation of there clearing the way for a run at the 85.85 level, its Nov 30'09 high and ultimately the 84.80 level, its 2009 low. This view remains valid while the pair trades and maintains within its defined falling channel. Its weekly RSI is bearish and pointing lower suggesting further downside weakness. On the contrary, corrective recovery if seen will initially aim at the 90.59/23 levels with a turn above there exposing its Jan 21'10 high at 91.86 and then its falling channel currently at 92.90 where a cap is expected.
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