Fundamentals
1) Japan monetary base in second quarter was 3.4 % higher than a year earlier. But BOJ Balance sheet asset contracted 6.42 % May/June.
2) Japan 2 year yield is moving in tandem with the Dollars heading to its historical Low, resulting in the elevated pressure on the YEN's rapid appreciation near terms.
3)Japan is aggressively implementing measures to stimulate internal spending to sustain growth by copying the China's Model, However, the rapid appreciation of her Yen will result in her decreasing Export, being detrimental to her modest plan for growth
4) The imminent Intervention from BOJ near term cannot be discarded.You must remember that the current PM ( Mr. Kan) is the Former Finance Minister who are Strong Advocate for a weaker Yen.
In short, an INTERVENTION may be imminent to stamp the rapid appreciation of Yen.
Technicals
USD/JPY was at 86.96 Low last week.
Referring to the H1/Daily Chart below, the immediate resistance is 90.27.
Above 87.88 (the Ichimoku Cloud Top and Tenkan-sen Resistance) will see the next target 90.27.
However, A break at 87.53 (61,8 % Fibo Retr) may send the price action retesting the next Support 86.96.
In short, Overall neutral with mixed signals.(Also on H4 , the price action is just resting on the Tenkan -sen line near 87.70 on last market's close)
Strategy
On Next Market open, Observe the PA(price action) , and wait for further correction near 87.54 before you execute your Buy order with confirmation from all your favorite Indicators.
Note: 87.54 is the 61.8% Fibo Retr on H1.
H1 Chart usd/jpy
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