Dollar/Yen Spotlight: Indicator of the Day

“INDICATOR OF THE DAY” - PSYCHOLOGICAL BARRIERS
While gains have ascended to fresh yearly highs on Thursday to 99.90, the market has stalled just shy of critical psychological barriers by 100.00. However, we expect this level to be taken out in the near-term, as more often then not, the market is inclined to take out these levels.

Usd/Jpy: has not been above the 100.00 level since November 2008, and with the market now just shy of this critical psychological barrier, we would expect for the level to be taken out. It is very common for traders to place stop-losses on positions above or below psychological barriers depending on the direction of their position. In this case, many stops are most probably sitting just over 100.00 which makes the break of the level that much more realistic. While we do not expect gains to extend much beyond 100.00 on Thursday, we would expect to see the 100.00 barrier taken out over the coming hours, making it the key level to watch today.

Written by Joel Kruger, Technical Currency Analyst for DailyFX.com
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