The Dollar based at 117.66 at the Asia-Europe hand over and the market has pushed price gradually to 117.98 highs. The market still has an offered feel to it and sellers who missed the 118.10 to 117.70 drop overnight are likely to enter the short side at levels around the 118.00-10 area.
A further defense of the yen's current levels from the MOF has met with very little market reaction. Hiroshi Watanabe has said that the FX market is relative and that currencies will rise in reflection of each nation's economic strength only if other conditions are unchanged. He also stressed that the "other conditions" are never the same in the market.
Japan has recently come in for criticism from Eurozone officials who feel the yen should be stronger vs the EUR for economic reasons. USD/JPY looks bid in the 117.70's and offered just ahead of 118.00. The risk is to the downside following Monday's 118.47 failure.
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