The rebound in USDJPY that started on 24 Jan 08 could only take it to 108 region. The Dow managed to rebound from 12300 region to 12700 region and the bulls ran out of steam succumbing to the attack of the bears.
The warning signals started to appear on 27 Feb 08 when the 8 day exponential moving average (Red line) fell below the 21 day exponential moving average (Green line). Once that happens, USJPY started to move decisively lower.
The Fibonacci retracement is suggesting a level of 103.48 for the USDJPY which is very close to the lower limit of the downtrend channel.
Based on previous correlation between Dow and USDPY, Dow may be due for a fall below 12000 level.
1 comment:
The chart looks terrible.
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