The current chart for the USD-JPY is strongly suggesting a fall in the USD back to 80yen. The USD has struggled to break out of the current trend, and we expect it to fall back to that support. This is the short term price action, though we do believe that the medium term outlook for the USD is stronger than for the JPY. The Democratic Party of Japan (DPJ) has allowed its fiscal reform opportunity to slip away with in-fighting over leadership. It is therefore expected that any sign of reform is at least a year away; perhaps under a new prime minister and some reinvention of the LDP.
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Andrew Sheldon www.sheldonthinks.com
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