USD/JPY (current price: 106.08)
The Yen continued to be weak compared to its most important peer as the pair drifted higher again on Monday, back above the crucial resistance level at 105.50. The strong rally last week propelled the cross near the upper resistance line of the declining long-term trend channel, and it will be interesting to see if the momentum will continue near the strong 107.50 level as well. The U.S. NAHB Index came in slightly lower than expected, and the negative housing data pushed the Dollar somewhat lower, but the pair still finished near its session highs.
Our assessment: The pair now gained 600 pips in two-weeks, but the declining long-term trend is still intact with the falling 200-day MA looming near the 113.25 level above the current rate.
