JPY soars up this morning against the leading currencies when it’s supported by the optimistic statements of Governor Shirakawa (Monday night) and declines on the Tokyo Exchange. Tonight Core Machinery Orders Index was released showing a mere 1.9% increase (comparing to the 5.9% increase expected). This Index, which reflects the state of Japanese economy, caused sharp declines on the Tokyo Exchange while making the Yen to jump ahead. Now JPY stands at ¥85.30 against USD, which is very close to the Dollar’s November ’09 low. The daily chart shows that since May 2010, when the pair was standing at ¥95.00, the Dollar has been having a downtrend against the Yen. If next USD support at ¥85.00 is broken, the Dollar might crash to the ¥80.00 area.


EUR/JPY – 111.20
The Euro is also losing to the Yen in the last couple of days, and for the same reasons. Although this pair has been fairly stable in August standing at about ¥114.00, now EUR is crashing to ¥111.20. It should be noted that EUR is weakening against the leading currencies while the Yen is actually gaining strength. If this trend continues in the next few days, the pair might slide to ¥110.00 (Euro’s next support).