Yen Advanced Against All 16 Majors Currencies

The Japanese consumer price Index showed growth of more than 2 percent for the first time in a decade

The dollar fell against the yen, headed for its biggest weekly drop in almost four months, on speculation a U.S. government report will show growth in consumer spending slowed. The yen advanced against all 16 most-active currencies after the Japanese consumer price Index showed growth of more than 2 percent for the first time in a decade as food and oil prices surged. A separate report showed industrial production rose 0.9 percent last month, counter to economists' expectations for a decline.

USD/JPY is trading around 108.60 at 12:00 London time

The following technical analysis gives us a detailed lookout on what is expected to happen to USD/JPY:

The selling point is at the market rate; based on a deep correction

• Fibonacci 23.6% is the take profit at 107.40
• Resistance Level is the stop loss at 110.50

The buying point is at 107.00; A failure to break a Fibonacci 23.60 resistance Level

• Previous resistance is the take profit at 110.30
• Previous support is the stop loss at 105.40

To strengthen our analysis; we use many other indicators: starting with MACD (Moving Averages convergence divergence); we notice the crossing of the two moving averages downwards above the zero line, the shorter term moving average is faster than the long term and is pointing downwards. In order to find the power of the market, we use RSI (Relative Strength Index).With RSI; we can determine that the market is in a bearish direction. The momentum oscillator is very important to understand the strength of the market and as we see on the graph is moving downwards. The Stochastic oscillator is on 40% line and continues to go lower.

USD/JPY Daily Chart

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