Fresh strength suggests that corrective pullback might be over
Bulls started to gain traction after pullback from 20-year high (131.34) found firm ground at 126.60/40 zone and fresh strength emerged on Monday.
Yen came under renewed pressure on rising prices of crude oil and a gap between the monetary policies of Fed and BoJ, which is likely to further widen, as the US central bank is hawkish while the Bank of Japan keeps the ultra-easy policy.
Daily techs started to improve as 14-d momentum turned north from deep negative territory and the larger action remains underpinned by rising and thickening daily cloud, however, fresh bulls need more evidence to generate positive signal.
Close above cracked 10DMA (127.73) is seen as initial requirement, with lift and close above 128.26 (Fibo 38.2% of 131.34/126.36 pullback) to further strengthen near-term structure and generate initial reversal signal.
Res: 127.94; 128.26; 128.85; 129.43
Sup: 126.85; 126.31; 126.00; 125.82