The Yen vs. the Dollar - Double Entendre?
Posted 11-11-2009 at 04:32 PM by fxKnight.com
The Yen vs. the Dollar - Double Entendre?
Andrei Pehar, Chief Currency Strategist, fxKnight.com
US Treasury Secretary Timothy Geitner was in Japan talking with Japanese reporters today, where he stated "I believe deeply that it's very important to the United States, to the economic health of the United States, that we maintain a strong dollar."
Meanwhile the question that remains is whether the Bank of Japan intervene if the USD/JPY breaks below 88.00 as they have in the past. The bank is silent on this subject at the moment.
Which brings us to this week’s truth-telling Fibs.
On October 7th, price reached a low at the end of a long-term downtrend at 88.03 By October 27th price had bounced up hitting a high of 92.33
As you can see on the chart, price looks as though it may be hitting a double-bottom with strong resistance at the 61.8 retracement level at 89.76
If price continues up from here, a very long-term target would be 94.98. Closer resistance levels to watch include 90.18, 90.69, 91.31 and 92.33, which would bring us back to the previous high.
If price finally does break this support level, the USD/JPY could go back to the 88.03 level, potentially pausing at additional support along the way at 88.95 - at which point we would find out what the Bank of Japan intends to do.
Andrei Pehar, Chief Currency Strategist, fxKnight.com
US Treasury Secretary Timothy Geitner was in Japan talking with Japanese reporters today, where he stated "I believe deeply that it's very important to the United States, to the economic health of the United States, that we maintain a strong dollar."
Meanwhile the question that remains is whether the Bank of Japan intervene if the USD/JPY breaks below 88.00 as they have in the past. The bank is silent on this subject at the moment.
Which brings us to this week’s truth-telling Fibs.
On October 7th, price reached a low at the end of a long-term downtrend at 88.03 By October 27th price had bounced up hitting a high of 92.33
As you can see on the chart, price looks as though it may be hitting a double-bottom with strong resistance at the 61.8 retracement level at 89.76
If price continues up from here, a very long-term target would be 94.98. Closer resistance levels to watch include 90.18, 90.69, 91.31 and 92.33, which would bring us back to the previous high.
If price finally does break this support level, the USD/JPY could go back to the 88.03 level, potentially pausing at additional support along the way at 88.95 - at which point we would find out what the Bank of Japan intends to do.
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Andrei Pehar, Sr. Currency Strategist, fxKnight.com
Andrei is a private fund manager, consultant to management, and a sought-after speaker and coach for professional traders and individual investors alike. At a young age he was already playing in professional chess tournaments, and went on to further hone his strategic skills through years spent studying Japanese martial arts. From both worlds, he brings with him a unique perspective to the financial markets.
His client list includes prestigious names such as UBS, Tower Asset Management (named by Bloomberg as top asset manager), Clifford Associates (investment counselors since 1915, officially acknowledged as the oldest in the United States), and several other high profile firms specializing in investment and wealth management for musical artists, sports celebrities, and other ultra high net worth individuals and trusts.
Andrei is a regular contributor to BabyPips, DailyFX, and FXStreet. He is currently working on a book which will, for the first time, introduce retail traders to institutional trading strategies and techniques. His site fxKnight.com provides free tools and strategies for professional traders and individual investors (including live chat, strategy forums, training videos, worldwide market news, and streaming ForexTV).
Click Here to view videos by fxKnight
Andrei is a private fund manager, consultant to management, and a sought-after speaker and coach for professional traders and individual investors alike. At a young age he was already playing in professional chess tournaments, and went on to further hone his strategic skills through years spent studying Japanese martial arts. From both worlds, he brings with him a unique perspective to the financial markets.
His client list includes prestigious names such as UBS, Tower Asset Management (named by Bloomberg as top asset manager), Clifford Associates (investment counselors since 1915, officially acknowledged as the oldest in the United States), and several other high profile firms specializing in investment and wealth management for musical artists, sports celebrities, and other ultra high net worth individuals and trusts.
Andrei is a regular contributor to BabyPips, DailyFX, and FXStreet. He is currently working on a book which will, for the first time, introduce retail traders to institutional trading strategies and techniques. His site fxKnight.com provides free tools and strategies for professional traders and individual investors (including live chat, strategy forums, training videos, worldwide market news, and streaming ForexTV).
Click Here to view videos by fxKnight
