Yen Pairs Weekly Update - Jan.28 close

USDJPY

The Dollar-Yen has been following the upper trend line of the weekly descending channel inscribed in a bigger falling wedge and ranging between 82.00 and 83.00 for the last three weeks. Monday price action went into a very tight consolidation between 82.00 and 82.25, and today is showing a bearish move with a break and retest of 81.80 level. Still I think the resistance has good possibilities to break for a push to 84.80/85.00 level which could extend to the weekly 38.2% Fibonacci retracement at around 85.90. On daily charts, I would expect a break of the confluence of SMA34 and SMA100 to reach the previous highs at 83.60/70. However, should the bearish sentiment gain momentum, we could see a break of the previous daily December lows near 81.00 with a potential for a 127% extension from previous swing low, targeting 80.30/79.90.

EURJPY

Euro-Yen was strongly rejected from 114.00 level and nearly performed a 38.2% Fibonacci retracement on the daily charts, after the continuation of previous week break of the descending triangle formation on weekly charts. Daily SMA200 and SMA100 confluence as well as the upper line of the triangle were retested and price closed on Friday around this level. Monday price action bounced back to the bullish side, and today is showing up to now a neutral pattern, with most price action maintained around 112.50/60. As long as it sustains above daily SMA200 we could expect a further bullish move towards the recent highs at 114.00 as first target, then a continuation for a retest of resistance level 115.70 (previous weekly highs) and psychological level 116.00 which also represents a 127% Fibonacci extension on previous daily swing high. On the bearish side, target could be the middle of the weekly range at around 110.50/40, which coincides with the daily upper trend line of the descending channel recently broken.

GBPJPY

The Geppy had a bearish week inside a wide range after a failure to break the daily SMA200 level at around 132.70/80 (weekly SMA34). Price has recovered as of today all of the Friday losses and is trading around Friday open levels. I would think of a continuation of the ranging action between 130.00 and 132.50 looking for a break of the daily SMA200 and bullish run to the 127% Fibonacci extension on previous swing high at around 134.60 or at least 134.30 (November 2010 weekly highs). On the downside, an increase in the bearish sentiment would bring us to a retest of the lows around 125.60/50.