USD/JPY Forecast: Heading towards 108.45
|USD/JPY Current price: 109.85
- Sentiment turned sour as the coronavirus pandemic keeps hitting the world.
- US weekly unemployment figures foreseen at record highs for the week ended March 20.
- USD/JPY nearing this week low at 109.66, the decline could accelerate once below it.
The USD/JPY pair has lost the 110.00 level, as optimism faded overnight. Wall Street closed the day mixed, despite news indicating that US senators agreed on a massive relief package that boosted sentiment. Asian shares are sharply lower, while European ones follow the lead. US Treasury yields are also losing ground.
The coronavirus pandemic continues to spread. The number of cases in the US approaches 70,000, and the country is expected to report an outrageous number of jobless claims in the week ended March 20. More countries add to the lockdown, while others extend it to mid-April. The measures are expected to impact harder economies. The US will also publish the final version of Q4 GDP, which is now irrelevant.
USD/JPY short-term technical outlook
The USD/JPY pair is trading at daily lows in the 109.80 region, bearish in the short-term. The 4-hour chart shows that the pair has finally broken below its 20 SMA, now flat and providing dynamic resistance at around 110.85. Technical indicators have fallen below their midlines, with the RSI heading firmly south at around 43. 109.66 is the weekly low and the immediate support, with a break below the level favouring an extension toward the 108.50 price zone.
Support levels: 109.65 109.20 108.70
Resistance levels: 110.15 110.50 110.85
View Live Chart for the USD/JPY
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