USD/JPY test 200-DMA, bias bearish, further downside likely
USD/JPY has hit 4-week lows at 109.77, before retracing brief dip below 200-DMA, retakes 110 handle.
Markets perceiving the possibility of the Fed slowing down the pace of policy tightening in response to criticism from the White House weighing on the dollar.
The 10-year treasury yield fell more than five basis points to 2.82 percent yesterday, sending the USD lower across the board.
Technical indicators are biased bearish. RSI and Stochs are sharply lower. We see -ve DMI dominance and ADX is also rising in support of downtrend.
Price action has dipped below daily cloud and has broken below 38.2% Fib. Decisive break below 200-DMA eyes 61.8% Fib at 107.89.
On the flipside, 110.45 (converged cloud base & 5-DMA) is immediate resistance. Break above cloud could negate the bearish bias.
Support levels - 109.85 (200-DMA), 109.37 (June 25/26 low), 108.90 (50% Fib)
Resistance levels - 110.45 (converged cloud base & 5-DMA), 110.90 (21-EMA), 111.15 (23.6% Fib)
Stay short on upticks, SL: 110.50, TP: 109.85/ 109.40/ 108.90
Markets perceiving the possibility of the Fed slowing down the pace of policy tightening in response to criticism from the White House weighing on the dollar.
The 10-year treasury yield fell more than five basis points to 2.82 percent yesterday, sending the USD lower across the board.
Technical indicators are biased bearish. RSI and Stochs are sharply lower. We see -ve DMI dominance and ADX is also rising in support of downtrend.
Price action has dipped below daily cloud and has broken below 38.2% Fib. Decisive break below 200-DMA eyes 61.8% Fib at 107.89.
On the flipside, 110.45 (converged cloud base & 5-DMA) is immediate resistance. Break above cloud could negate the bearish bias.
Support levels - 109.85 (200-DMA), 109.37 (June 25/26 low), 108.90 (50% Fib)
Resistance levels - 110.45 (converged cloud base & 5-DMA), 110.90 (21-EMA), 111.15 (23.6% Fib)
Stay short on upticks, SL: 110.50, TP: 109.85/ 109.40/ 108.90