Forex: USD/JPY buying hysteria persists; 98.50 hit in early Asia

FXstreet.com (Barcelona) - The Kuroda-led Yen decline continues to pick up further bear momentum through twilight Asian markets, with still little indications in the horizon suggesting that the selling hysteria is over. However, it is starting to become obvious that buying at such hefty level without a meaningful pullback is getting riskier.

The USD/JPY rate stands now at 98.55 from last Friday's 97.58, which follows a more than 4.5% appreciation in the past 2 trading days or over 500 pips since facing the strong demand level at 92.40/70 pointed out in varies occasions by FXstreet.com Asian team.

Looking at key supply and demand levels where a turnaround may be expected, the sky for bulls appears blue until a weekly supply which embraces an area comprised between 99.20 and 101.40 is faced, as per a rally-base-drop structure from April 2009. On the downside, there are two demand areas spotted intraday where unfilled buying orders are likely to be clustered; one being 97.63/97.50, as per drop-base-rally from last candles of NY/first in Asia, ahead of deeper pullback into 97.15/97.00.

According to Sean Lee, founder at FXWW, "the extreme volatility which started after the BOJ on Thursday is certain to continue, thus buying dips is the way to go for now and we might even see a test of 100.00 in the next few sessions."