USD/JPY inched through 81.35, the 50% retracement of the post-earthquake range overnight but it bounced back strongly and broke the downtrend in place for the last three weeks or so. A break of the 82.45 area would target a bounce to 82.89, the 38.2% retracement of the 85.50/81.25 decline.
Firmer US yields and a downgrade in Japan’s sovereign debt outlook by S&P have been fundamental catalysts for today’s bounce. 81.90/00 is support on dips near-term.
