USD/JPY extends 150-pips sell-off amid flight to safety
The USD/JPY pair is on a declining trend since Friday, after having faced rejection at multi-month tops, now extending the sell-off towards 111.50 amid increased flight to safety.
Yen gains for 2nd straight session
The dollar-yen pair is now seen making minor-recovery attempts, although remains deep in the red zone as the Asian Monday started-off on a cautious note, after Friday’s OPEC consultations ended in doubt over the output cut deal to be reached later this week, and therefore, shattered investors’ confidence in risky assets, which in turn boosted the demand for safe-havens such as the JPY.
Moreover, the bearish pressure behind the major is also partly attributed to the ongoing broad based US dollar correction, after the recent strength-driven by Trump’s victory and on increased prospects of a Dec Fed rate hike.
Markets also remain on a cautious footing heading into the NFP week, with a string of crucial economic releases due on the cards from both the US and Japan, to drive the moves in the spot going forward.
USD/JPY Technical levels to watch
The major finds immediate resistance at 112.64 (5-DMA). A break above the last, the major could test 113.23 (daily high) and 113.91 (multi-month high) beyond the last. While to the downside, the immediate support is seen at 111.50 (psychological levels) next at 111.09 (1h 200-SMA) and below that at 110.80 (Nov 23 low).
To learn more about this topic, check our video analysis