Richard Perry
Independent Analyst
USD/JPY
There is still a positive outlook whilst the pair trades above 109.00 and near term corrections remain a chance to buy. However, taking a step back suggests that momentum is not as strong as it should be with a breakout to multi-month highs that has been seen. The outlook is positive without being overtly bullish. The 11 week uptrend around 108.40 underpins the move higher and whilst the 108.65 support is intact there will still be bull control. However, if the market continues to fail under 109.50 (last week’s high) the bulls may be beginning to tire. A close above 109.50 is needed to open 109.90 and the May high at 110.65 as the next real test, and if comes with RSI into the high 60s it would be a key confirmation. However, for now, given the rather drab candles of recent sessions, focus is more on a consolidation around the 109.00 breakout and defending 108.65 as initial support. With the Average True range around 50 pips and multi- month lows, this is a market consolidation. Have the bulls got the energy to decisively breakout?
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