Archived IMT (2009.10.21)

USDJPY has been immune to the broad attack on the US dollar mainly due to escalating selling in JPY (the other low yielding currency) as well as concern from Japanese officials regarding excessive yen strength. Unlike in recent USD-selling episodes, USDJPY remained robust. Looking ahead, the 91.70-90.30 range is expected to prevail with 91.70 serving as the 38% retracement of the decline from the Aug high, and 90.30 as interim target for dolalr bears as well as risk aversion play. Any disappointing US figures acting as a source of risk aversion could drag it back towards 90.50s.