Forex: USD/JPY higher on new BoJ chief headlines

In a quite busy Asian session ahead to start the week off, with Italian election results to come out, and HSBC flash manufacturing PMI China at 01:45, USD/JPY has printed yet another new multi-year high at 94.55 according to Oanda feed, on weekend news that a new BoJ chief could be chosen soon. The pair has shot up from a premarket interbank high at 93.50, gaining so far +1.04% from previous weekly close Friday, last at 94.35.

“The Yen has weakened on the back of weekend reports that a noted ‘Dove’ Kuroda is set to become the new BOJ Governor,” said FXWW founder Sean Lee, adding: “I cannot really understand the over-reaction to this news with EUR/JPY over 200 pips higher than the NY closing level. With a risk event in the shape of the Italian election about to take place, I still fancy playing the Pennant formation and selling rallies to 126.00,” the analyst noted.

Immediate resistance to the upside for USD/JPY shows at recent session highs around the 94.60/75 levels, followed by May 2010 highs at 94.98, and Aug 2009 highs at 95.30. To the downside, closest support lies at Feb 18 highs 94.20, followed by Feb 20 highs at 94.06, and Feb 15 highs at 93.84.

Feb 25, 2013

Forex Flash: Italian elections a potential risk event for the euro - NAB

On the ongoing Italian elections, according to NAB, "anything other than a clear win for Bersani’s Democratic Party in the lower house and a seemingly workable Bersani/Monti coalition in the Senate (the Senate has equal say on policy matters) will almost inevitably see pressure resurface on euro peripheral debt markets and with that risk that EUR/USD heads further south to as far as 1.30" the bank said.

Forex Flash: GBP/USD, range breakout allows 1.35 longer term - BBH

After the largely discounted headline of a UK downgrade, which became effective last Friday, the Sterling appears to have broken out of the consolidiative pattern that it has traced out since early 2009, says Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman. The downside resolution of the pattern, in the eyes of Marc, "will allow sterling to decline toward $1.48-$1.50 and possibly even back down to the $1.35 area in the somewhat longer term" he said. Should GBP/USD regains the $1.56-$1.57 area, it would negate this view, Marc adds.