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Yen rally eases, setting to fall further

Published 09/15/2010, 07:17 AM
Updated 09/15/2010, 07:20 AM

The Japanese yen is currently steady to halt its rally that caused the yen to drop sharply against majors on the back of the BoJ intervention to prevent the currency from strengthening further.

Policy makers decided finally today to intervene for the first time in FOREX market through selling yen to weaken its currency that hovered above 15-year high against the dollar to protect national exporters and boost growth.

Refuges, led by the yen, have benefited from the financial crisis that boosted them to very high undesirable levels that called policy makers to intervene to save their economy. The same action happened from the Swiss National Bank that weakened its currency against the euro.     

Today's step is probably the first but not the last action from the BoJ as it is expected to see the yen dropping more in the coming period, ending its dominance over majors.

With regard to the dollar-yen pair, it eased its rally to 85.11 after touching a high of 85.51 after the breach of resistance at 84.80, where the trading range for today is among the key support at 83.45 and the key resistance at 86.35.

Concerning the euro-dollar pair, it is showing decline on the daily and 4-hour charts falling from a high of 1.3022 where it found resistance at that level.

Today' news showed that CPI remained unchanged at 1.6% whereas employment for the second quarter also lingered at 0.0%.

Now, the pair is trading at 1.2960 after recording a low of 1.2953, while the trading range for today is among the key support at 1.2825 and the key resistance at 1.3145.

Turning to the sterling-dollar pair, it slipped on the daily charts but currently facing upside pressure from 4-hour and 1-hour charts which pushed the pair up to 1.5511 from the day's low of 1.5447.  

The pound faces more pressure after the news showing that jobless claims rose for the first time since January, while ILO unemployment remained steady at 7.8% in the three months ending July.  

The trading range for today is among the key support at 1.5345 and the key resistance at 1.5700.

 

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