Yen under pressure amid Japan’s economic and political uncertainty

The Japanese Yen has lost its ground this week against the dollar as Japan suffers from the deepest contraction in decades and the public is losing its trust in  the current government  and its  Prime Minister Taro Aso.

USDJPY has advanced sharply up this week to meet its main resistance area (yesterday) around 94.
As expected, the pair failed its first attempt to break above 94, this level is the major resistance of USDJPY since October 2008.
This morning we are back to 93.5, with a possible second try to test the 94 level, and if indeed clearly breached,  it might take us to fresh new highs – possibly to the next resistance at 96.5 in the near future.
However, a failure to break 94 in due time, should stimulate traders to buy back the Yen, sending the pair lower to meet  the 90 – 92 range once more.

Z.Georgi

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