Richard Perry
Independent Analyst
USD/JPY
The slide back on the dollar really began to impact on USD/JPY yesterday as even the yen strengthened yesterday on a day that ended up with positive risk appetite. The correction back has really begun to gather pace now, and is continuing this morning. Having broken the strong uptrend channel, the rally has now topped out. Momentum indicators are increasingly rolling over now, with the bear cross on Stochastics coming and RSI falling back below 50 too. The hourly chart shows the corrective momentum building, with the breakdown below 109.30. This effectively confirms a top completion (implying c. -220 pips towards 107.30) and the market is now beginning to form lower highs and lower lows. Hourly RSI and MACD are decisively correctively configured and intraday rallies are becoming a chance to sell now. A move below 108.55 (an old pivot) would be another step in the correction. A mini downtrend comes in around 109.50 and any intraday rally faltering between 109.30/109.50 is a selling opportunity now. Next support is around 107.85.
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