The pair has gapped down to start the week, currently trading at 102.40 in early Asia trade. Early weakness has been attributed to some comments from Japanese officials that hit the tape over the weekend. According to analysts at FXStreet.com, “Japan's economy minister Akira Amari crossed the wires over the weekend warning that the yen's excessive strength has been largely 'corrected,' and further weakness could be harmful." Economic data in the coming session out of Japan will be limited to Leading Economic Index and Machine Tool Orders.
The FXStreet.com Trend Index remains in slightly bullish set up on the daily hour chart, while the OB/OS Index reads Overbought. The pair has broken the first two support levels of 103.07 (9dma on 1 hour chart), and 102.70 (the 20dma on 1 hour chart) which will now act as resistance. Further support can now be found at the 102.00 level (previous resistance, now support on 1 hour chart).
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