Yen vs Dollar - 1st April 2009 Candlestick Chart

Yen vs Dollar - 1st April 2009 Candlestick Chart

With Japan’s fiscal year end now firmly out of the way, the Tankan survey the worst on record and yesterday’s bullish engulfing signal, coupled with the BOJ’s determination to have a weak Yen, we should now see a breakout to the upside through the resistance at $99 and above.   Last night’s close finished above this region and with all three moving averages now providing additional support you should be looking for buying opportunities in the dollar to yen in the next few days with an initial target of 102.50 and if this is broken we could see a move to re test resistance at the 104.50 region and above.  This morning’s price action has provided some excellent buying opportunities with an initial small fall followed by a reversal.  I would suggest placing any stop loss in the 96.75 region or below.

With regard to the fundamental news on the economic calendar the only release due for today in Japan is the Monetary Base released by the BOJ which represents the change in the total amount of Japanese Yen in circulation and includes current account deposits held at the BOJ.  The forecast is for 6.8% against a previous of 6.4% with the data being positively correlated with interest rates.  The main fundamental news for today in the US with 4 key announcements which I have covered in more detailed on the euro to dollar site.

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