USD/JPY Heads Towards Important Support

  @ibtimes on August 21 2009 3:50 PM

The Yen is continuing its appreciation against the Dollar as investors exercise risk-aversion tactics in reaction to weaker than expected retail sales and employment data. The USD/JPY's decline coupled with gains in the GBP/USD and EUR/USD indicate investors are exiting the Dollar. Despite the USD/JPY's present pullback, the currency pair still has important technical cushions in place, including our 1st tier uptrend line and the psychological 95 area. The USD/JPY's near-term uptrend is intact until these two supports are compromised. Therefore, it will be interesting to see how these supports hold up over the immediate-term. Meanwhile, our 3rd tier downtrend and 1st tier uptrend lines are gradually approaching their inflection point. Hence, the USD/JPY could jog between these trend lines as their collision course nears. We notice inflection points in the rest of currency pairs along with gold. As a result, FX volatility could continue for the next couple trading sessions. On the other hand, the USD/JPY has re-entered a dense trading range, meaning a period of consolidation would not be surprising.

Present Price: 95.45

Resistances: 95.61 95.91, 96.10, 96.47, 96.67

Supports: 95.30, 94.99, 94.75, 94.52, 94.36

Psychological: 95

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