Thursday January 22, 2009 - 16:59:36 GMT
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Chart of the Day - 1/22/2009 - USD/JPY
(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend line in red; chart patterns in magenta; 50-period simple moving average in light blue.)
1/22/2009 â€“ USD/JPY â€“ Price action on the USD/JPY (a daily chart of which is shown) has just made a precise double-test of the pairâ€™s 13-year low that was recently established in mid-December 2008. This extreme support level resides just a few pips above the 87.00 mark. Wednesdayâ€™s price bar (1/22/2008) descended all the way down to this level, was summarily rejected, and then ended up closing around 89.50. Thursdayâ€™s bar, as of the morning, is showing some of the same nature as Wednesdayâ€™s bar. More likely than not, this pair should be seeing a consolidation above the 87.00 support. The obvious event to watch for is any major break below 87.00, which would put the pair in essentially unprecedented territory. A substantial breakdown of this level would likely carry enough bearish momentum to take the pair down at least to the 85.00 region. To the upside, the 91.00 support/resistance region remains as key intermediate resistance for the time being. And, of course, an actual double bottom reversal would only be confirmed on a substantial break above the swing high peak around 94.60.
Chief Technical Strategist
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