Last night's diverging dollar support levels continue to cap further dollar weakness heading into tomorrow's 8:30 a.m. NFP. But dollar support seems to be more pronounced vis-a-via yen, as USD/JPY regained all losses following comments from Vice Finance Minister Watanabe that the yen should not weaken from internal reasons, because Japan â�,��"is likely to maintain solid growthâ�,�. Furthering the case for a stronger EUR/JPY, is EUR/USD, which seems hungry for stops above 1.2830.

Our readers grabbed 50 points from the 149.00 EUR/JPY support level earlier this week. Following the Wantanbe's comments last night, EUR/JPY went back down for a second test of that figure support, which was Tuesday's trade entry, that again held quite nicely. The specific technicals giving us that 149.00 support level are labeled on the chart.

In fact, the rebound was so nice, that we're right back at 149.60 resistance. A 149.60 break (just happened, actually, typing a little slow this morning) could setup a nice trendline retest for entry at 149.50-60 for a move up to 150.00. My regular readers know that it's not uncommon for us to carry a cross, especially EUR/JPY, into Non-Farm Payroll. It's not in any way intentional, but often the crosses will shape up for a nice trade heading into a major economic release. Stops should be very tight, say 149.38. Back tonight before Asia with an update.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

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