During the Asian session on December 27th, 2012 USD/JPY Broke over the psychological level of 85.00 first time since April 2011.
After the Tsunami hit Japan on March 11, 2011 with an earth quake of 9.0 magnitude on Richter scale, they Japanese Yen had gone down to 76.59 on March 16th 2011 but then had recovered to touch 85.52 on April 5th 2011. This was the first time for USD/JPY to hit 85 since mid September 2010. Since then the current pair remained below 85.00 with first low at 75.36 followed by the high of 84.18 and then the subsequent low of 77.13.
The Christmas of 2013 seems to have brought some cheers for Japanese Yen which has been hurting the national exports badly because of being strong against all currency majors. The economy has been depressed and the currency has been strong, proving that it was being preferred as a safe haven currency better than the U.S. Dollar. The opening of Asian session after the Christmas holiday saw USD/JPY to break the barrier of 85.00 after over 21 months. The pair went as high as 85.72 and staying bullish around there.
The next resistance over 85.00 level was 85.97 during September 2010 and the pair is slightly below that. If that resistance is also taken off then we can expect some more substantial gains first towards 86.80 and then possibly towards 88.20.
Some important dates and price action since 2010 for ready reference:
1) May 2010: 94.98
2) April 5, 2011: 85.52
3) March 11, 2012: 84.18
4) December 27, 2012: 85.72 as of now.
1) March 16, 2011: 76.59
2) October 30, 2011: 75.36
3) September 9th 2012: 77.13
Note: All dates mentioned are according to Japan Standard time which is UTC (GMT) +9.00 hours.
Connect with the author at Google: +Himanshu Jain.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: The views are based on the fundamental facts and price action, but these remain the author's outlook and not investment advice.