Market Overview

USD/JPY Technicals – 8 Weeks Bull Run Over?

30 Minutes Chart

http://forexblog.oanda.com/mserve/USDJPY_070113M30Tech.PNG

Yen strengthened early Monday which saw Asian equities trading lower. Short-term upward trendline has been broken, suggesting a slowdown/pull-back from the bullish momentum. Price is currently trading around interim support of 87.75, with a break opening up 87-87.25 trading range as a potential downside target.

Weekly Chart

http://forexblog.oanda.com/mserve/USDJPY_070113W1.PNG

However, on the Weekly, today's price is just a blip against the strong bullish backdrop. Nonetheless, interim support 88.10 (see chart above) is the confluence of the support found back in Q1 2010. Also, USD/JPY has seen an unprecedented 8 consecutive weekly gains that is not seen in recent years. The previous time Yen saw similar bullishness in Q1 2012, the peak was followed by a drop of 650 pips (~84 to 77.5). Hence, a sizable pullback from here is not unforeseeable, with 23.6 Fib and 84.0 potentially providing support.

 

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