Dollar/Yen drifted higher yesterday but in a whippy fashion, suggesting that a top is developing.At this stage there is no firm sign that a top has formed, and so long as Dollar/Yen holds above 116.15 it will continue testing the upside.But any further gains will be limited in scope.A break of 116.15 will lead to a test of the 115.50/70 region.If that level contains the drop then Dollar/Yen can rally once more and challenge the 117.90 high.A drop through 115.50 will be an early sign that a new decline may develop but only a break of 115.10 will confirm it.
Euro/Yen pushed up to 148.55 yesterday and has stalled.After an initial drop to 148.20 it can rise again and challenge the long-standing objective of 149.00.A reaction back to 147.15 should follow.Such a drop will also create the potential for a return to the last low at 145.70.Only a strong rise through 149.00 will suggest that the rally can continue.
Aussie/Yen hit 89.35 yesterday and then turned down to close near its 88.45 low and to signal the start of a drop back to 87.20.Expect some ranging 88.20/80 today before the drop continues.
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