The Japanese yen has been in a strong bearish trend against most rivals since early November, mounted on final acknowledge of the country woes, and the key factor, elections to be held this Sunday. Shinzo Abe, leader of the Liberal Democratic Party will probably won the elections and Abe will have a 7-month period, before next elections, to apply the aggressive monetary policy he has been claiming for the past few months. Indeed, pricing in more easing has helped yen crosses to advance near yearly highs, particularly against Euro and Yen.
For the EUR/JPY, the daily chart shows price broke above a daily ascendant channel yesterday, and fresh highs had been posted today after completing a pullback to the broken line. Currently quoting around 109.75, the pair has scope to extend the upside once above 110.20, towards 111.45 this year high, reached late March. More gains however, will remain limited for now, and a consolidation period may be followed by a slow but steady slide as Japan fiscal year end gets closer. For next week, 108.80 and 108.00 are the supports to watch, with chances of a deeper slide below this last, up to 107.10 if somehow market sentiment regarding yen reverses.
For the USD/JPY, the upward momentum also prevails in the daily chart, although the pair retreats from the 84.00 level, 20 pips shy today from the year top of 84.17. Downward movements however remain corrective, with 82.80 now as immediate support ahead of the 82.30 area; dips towards this last should be consider buying opportunities with tight stops right below 81.80. To the upside, break above 84.17 may open doors to a run towards 85.00 this week, but gains beyond 86.00 should not be expected anytime soon.
For the EUR/JPY, the daily chart shows price broke above a daily ascendant channel yesterday, and fresh highs had been posted today after completing a pullback to the broken line. Currently quoting around 109.75, the pair has scope to extend the upside once above 110.20, towards 111.45 this year high, reached late March. More gains however, will remain limited for now, and a consolidation period may be followed by a slow but steady slide as Japan fiscal year end gets closer. For next week, 108.80 and 108.00 are the supports to watch, with chances of a deeper slide below this last, up to 107.10 if somehow market sentiment regarding yen reverses.
For the USD/JPY, the upward momentum also prevails in the daily chart, although the pair retreats from the 84.00 level, 20 pips shy today from the year top of 84.17. Downward movements however remain corrective, with 82.80 now as immediate support ahead of the 82.30 area; dips towards this last should be consider buying opportunities with tight stops right below 81.80. To the upside, break above 84.17 may open doors to a run towards 85.00 this week, but gains beyond 86.00 should not be expected anytime soon.
