Updating time : 01/11/2007 00:16 GMT

USD/JPY - 115.36...The greenback finally broke out of its recent broad range of 113.25-115.04 y'day on active cross selling in yen n despite the o/n very brief retreat fm 115.51 to 114.90 after Fed cut rates as expected, the dlr rebounded fm there in line with the rise in U.S. stocks (further accumulation of yen carry trades due to increased risk apetite).

Today, as price is trading abv both 21-hr n 55-hr emas, suggesting the erratic rise fm last week's low at 113.25 to retrace recent decline fm 117.95 (Oct 15) wud extend to 115.73/79 (res n equality proj. of 113.77-115.03 measured fm y'day's low at 114.53) but as hourly stochastics are likely to be in o/bot territory on such move, reckon 116.15/18 (61.8% r of 117.95-113.25 n prev. sup) shud cap upside n yield retreat later today or tomorrow.

Therefore, whilst trading fm long side is favoured, profit shud be taken on next upmove. Below the o/n NY reaction low at 114.90 wud signal a temp. top has been formed instead n risk correction twds 114.38 (sup n 50% r of 113.25-115.51, adjust latter lvl if necessary) but 113.98 sup shud hold...

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