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Forex Flash: The USD/JPY focus is now on the 97.00/97.80 zone - JP Morgan

After reaching fresh highs since August 2009 at 93.55 on Friday, the USD/JPY is trading in consolidation mode between 96.00 and 96.20 but according to JP Morgan's analyst John Normand the focus now is above the 97.00 level with market watching corrections as buying opportunities.

The "JPY is the key focus following last week’s bearish action and breakout for USD/JPY. With the push through the important 94.77/95.00 resistance zone (includes the 2010 high), the focus is now on the 97.00/97.80 zone (includes the Aug ’09 high)," comments Normand.

In turn, "corrective retracements are viewed as buying opportunities as pullbacks should find support at 94.75/94.10 and 93.50. Still, given the potential momentum divergences, the upside is likely to be more of a grind to new highs," JP Morgan analyst concludes.

Session Recap: FX market takes a breather

Consolidation is the theme of the day in the FX market after the strong USD rally witnessed last Friday in the wake of the strong US NFP figures. In the absence of major economic events or releases, most crosses were left within limited ranges. The pound is among the worst performers, having hit a fresh 32-month low of 1.4865 during the European session. The euro continues to oscillate around 1.3000, while the USD/JPY holds near a 3 ½-year high. US stocks opened with mild losses, tracking their European peers.
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