USDJPY falls as risk aversion leads to a flight into the JPY
The USDJPY has moved to new lows on the back of the weaker GDP data. The price broke through the 88.56 low from yesterday and has moved to a low of 88.34. The 2009 low comes in at 88.00. This is the next target for the pair. Risk aversion is helping to contribute to the losses.
The USDJPY has been in a narrow trading range over the last week. The price yesterday broke briefly above the 100 hour MA for the first time since November 13th. However, the momentum quickly reversed as resistance against 89.17 held. This helped pave the way for the move lower overnight. The pair will likely be influenced by what equities do this morning. The S & P futures are showing a small gain of 2.3 while the Nasdaq is down 1 point. Dow futures are up 11 points currently before the opening at 9:30 Look for the target at 88.00 to find buyers against the level. ON the topside, the 88.65 level where the 100bar MA on the 5 minute chart is found, should provide upside resistance. The price has been tracking below the 100 bar MA for most of the trading day today. As long as the price remains below this level, the bias is down for the pair. The caveat is when the price moves toward the 88.00 level. I would expect profit takers to enter the market on dips toward that level.
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