• Home ::
• Technical ::
• Analysis Reports ::
• Daily Forex Technical Report

• Send
• Print
• Add To
• Rss

Daily Forex Technical Report

463abccb-abec-48ce-b547-4aa57e8faff4

0

0

Daily Forex Technical Report − Yen Extends Recovery, Dollar Soft

Mon, Jun 30 2008, 07:02 GMT
by ActionForex.com Team

ActionForex.com

Action Insight Daily Report

Yen Extends Recovery, Dollar Soft

The Japanese yen is broadly higher as the week starts as markets are still concerned that skyrocketing oil prices are going to hurt the global economy. Note that while there is no confirmation of reversal in the near term trend in the Japanese yet, the failure to sustain below key medium term support against Euro and Sterling is taken as an early signal of a possible comeback in the yen. Meanwhile, particular weakness is seen in USD/JPY which is now pressing important near term support at 105.70 and decisive break of which will argue that USD/JPY has already topped out and will be another warning of yen strength in general.

Elsewhere, dollar remains generally weak for the movements against other majors are limited so far as focus lies in yen crosses. Nevertheless, markets will still pay close attention to Jun Eurozone CPI estimate which is expected to accelerate sharply from 3.6% to 3.9% yoy. As expected high reading of inflation will solidify the case that ECB will raise rate this Thursday. Other focuses today will be Apr Canadian GDP which is expected to recover by climbing 0.3% mom, and US Chicago PMI which is expected to stay below 50 at 48.4 in Jun.

Data released today saw UK Gfk consumer confidence tumbled further from -29 to -34 in Jun, hitting the lowest level since 1990. Japanese manufacturing PMI dropped from 47.7 to 46.5 in Jun. Housing starts dropped -6.5% yoy in May to 1.07M. Construction orders fell -25.2% in May.

More Technical Analysis Reports Here

USD/JPY Daily Outlook

Daily Pivots: (S1) 105.58; (P) 106.39; (R1) 106.94; More.

USD/JPY dives further to as low as 105.62 today and is now pressing key near term cluster support of 105.56/58 (50% retracement of 102.58 to 108.58 at 105.58 and 23.6% retracement of 95.77 to 108.58 at 105.56). At this point, intraday bias remains on the downside as long as 106.47 minor resistance holds. As discussed before, firm break of this cluster support will add more credence to this case and bring deeper decline to 104.43 support first. On the upside, above 106.47 will turn intraday outlook neutral first. But still, break of 108.59 is needed to turn short term outlook bullish again. Otherwise, risk remains on the downside.

In the bigger picture, USD/JPY has made a medium term bottom after down trend from 124.13 has just met 76.4% retracement of 79.75 to 147.68 at 95.78. Failure of 108.59 resistance is taken as the first signal that rebound from 95.77 has completed. Further break of 102.73 support will confirm this case.At this moment, it's premature to conclude whether rise from 95.77 represent whole correction pattern to fall from 124.13 or just part of it. But in either case, deeper fall should be seen to 61.8% retracement of 95.77 to 108.59 at 100.66. On the upside, while another recovery could be seen, short term risks will remain on the downside as long as long 108.59 key medium term resistance holds.

Stay tuned with our Forex Newsletters

ActionForex is set up with the aim to empower individual forex traders by providing insightful contents. Analysis reports, live pivot points on majors and crosses, etc are provided with collection of carefully selected educational articles and free trading ebook downloads.

Published on  Mon, Jun 30 2008, 07:04 GMT