US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 15th July 2009

US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 15th July 2009

Yesterday’s candle on the daily chart for the yen to dollar pair finished the day with a wide spread up bar confirming the tweezer bottom trading pattern outlined in Monday’s market commentary (for once it feels very satisfying to be right) and this momentum has carried through today’s trading in both the London & NY sessions, having broken through the 9 day moving average.  However, we need to trade this mini reversal with care as we are now beginning to approach the strong resistance created in the last three months and, in particular, the outer-lying regions at 94 and 94.50 which are coming into view.  To break back through this massive consolidation region will take a substantial effort, not least from the BOJ who will be determined to see a weaker Yen given the current state of the Japanese export market.   This should be assisted in this strategy with investors regaining their appetite for risk resulting in a consequent selling of the Japanese Yen.

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