USDJP Y was closed by stop with loss of 30 pips.

New position - to buy GBPUSD at 1.9653

at 121.75 stop 122.05

Although Japanese importer demand is seen to have subsided following the Tokyo fix, the USD/JPY bias remains up with the pair up to as high as the 121.80/85 level. It currently trades just below at 121.77/80 but bidding interest remains firm. It seems a number of specs are intent on taking out topside option barriers at 122.00. Defensive sales continue however and the going seems to be slow but some players say it may only be a matter of time now before the level is pierced. Stops above are seen to be large and could propel the market up towards 122.40, a long-term Fibo retracement level and where the 1% moving average envelope comes in. Next resistance is eyed at 122.85, a high dating back to December 13, “02. That month saw USD/JPY as high as the 125 handle. Support below remains at 121.20-30 and then towards 121.00

Sydney, January 24: The USD/JPY has retreated from resistance around 121.80 after selling orders between 121.80/122.00 discouraged attempts higher. There is talk in Tokyo of stops above a rumoured barrier at 122.00, but there is very good selling interest between 122.20/40. Hourly support has formed around 121.55 and a break below that level will temporarily take the pressure off of the topside. The USD/JPY trades 121.60/65

Tokyo, Jan 22. Today looks to be a continuation of what took place towards the end of last week with offers in USD/JPY above 121.50 looking to cap the upside again and bids still eyed towards 121.00. Some light stops may be seen below 121.00 but bids below look to trail down to 120.00 if not lower. Japanese importers still have quite a bit to do before month-end and this, along with the taking out of topside option barriers at 120.00 and 121.00 has a number of these and other players net short. The bias remains up on expectations of low Japanese interest rates indefinitely. That said, helping to cap the upside is a net USD long situation, apparent especially in EUR/USD. Every move down in this pair looks to have been rejected with central banks bidding towards 1.2900. Unless EUR/USD can break lower, it may be difficult at this time for USD/JPY to move higher. Option players continue to offer copious amounts above 121.50 to defend more option barriers at 122.00. There is talk of some ahead as well at 121.75. Whatever the case, the market currently looks to be lacking the reasons to take USD/JPY higher. USD/JPY currently trades 121.26/29 with most eyeing a quiet day. The focus looks to be the government”s latest economic assessment due towards the end of the Tokyo trading day.

JPY losses accelerated after BOJ Governor Fukui offered little on future hikes. He said there was no predetermined timing for a rate hike encouraging broad based JPY selling. The JPY lost ground against GBP, AUD, NZD, EUR and the USD. USD/JPY immediately breached 121.00 at the start of the European session and extended higher. Buying was noted from speculative accounts, real money names and leverage funds. The pair traded into 121.30 and experienced very good two-way action before moving up to a 121.45 high. The pair slipped back into the 121.25/30 area, yet remained bid throughout. EUR/JPY saw a similar theme, extending to 157.37. An overhang of Japanese offers coupled with sizeable USD/JPY supply at 121.45 capped EUR/JPY gains. Profit takers moved in, with one UK name selling in good size. A US name on behalf of a fund was a good buyer ahead of 157.00 and this kept the pair bid ahead of the US session. GBP/JPY also pushed higher, yet topped out ahead of large size 240.00 stops. We expect the crosses and USD/JPY to trade on the firmer side in the near-term, with BOJ policy bias encouraging further JPY-funded positioning.

our position closed by stop

The USDJPY has pushed above Friday’s high of 119.04, making the rally from 118.10 to 119.21 roughly equal to the rally from 117.97 to 119.04 (111 vs. 107 pips). The equality of the two waves and the fact that they each subdivide into 3 waves suggests that the pair has traced out a flat to correct the impulsive 119.67-117.97 decline. Price needs to turn down from near current levels for the bearish structure to remain intact. A break above 119.67 shifts focus to 120 and beyond. A measured objective for a move down is where the decline from 119.21 would equal the decline from 119.67-117.97 – at 117.52.

We have sold USDJPY at 119.36. Stop 120.16. Target 118.3 (116.5 extended target)