USDJPY: With the pair extending its bullish momentum and breaking above its key resistance at the 81.86 level at the end of the week, the broader risk is for USDJPY to strengthen further in the new week. This development now calls for more recovery towards the 82.80 level, its April 27’2011 high and possibly higher towards the 83.75 level, its April 15’2011 high. On continued strength, the pair could target the 85.49 level. Its daily RSI is bullish and pointing higher supporting this view. Alternatively, on any pullback, its broken support at 81.86 level should reverse roles and provide support. However, if that fails to hold, further weakness should build up towards the 80.57 level where a breach will target the 78.18/27 levels and then the 77.35 level, its Feb 14’2012 low followed by the 76.01 level. All in all, having resumed its medium term uptrend, ways are now open for further strength in the days ahead.
