USD/JPY: bulls not throwing in the towel, just yet, testing 50hr SMA
|- USD/JPY bulls are advancing on thin ice in Tokyo.
- We have yet further key events this week, which are sure to keep traders alert and not fully positioned one way of the other.
USD/JPY is currently testing the upside in Tokyo, with bulls reluctant to completely throw in the towel just yet in what seems to be an overstretch position in the pair. USD/JPY is trading at 112.44 with a high of 112.45 and a low of 112.25 as the dollar remains investor's preferred hedge in the current climate.
USD/JPY fell back from 112.50 to 112.10 on the day while markets paused in the advance, despite a positive revision to the key US retails sales data. As for US yields, the US 10yr treasury yields climbed from 2.83% to 2.88% while the 2yr yields rose from 2.58% to 2.61%. The Fed fund futures yields continue to price in 1 ½ more hikes for 2018. The DXY was trading between a range of 94.4080-94.7740 where the dollar pulled back as the session went by, ending NY at 94.6920.
We have yet further key events this week
We have yet further key events this week, including Powell's two-day testimony, US IP and the Beige Book. Meanwhile, the enactment of the US/China tariffs could put the breaks on in the bulls advance and eyes can turn back to 111.33-54 as the key downside support level.
USD/JPY levels
Valeria Bednarik, chief analyst at FXStreet explained that the 4 hours chart shows that the price remains well above bullish 100 and 200 SMA, while technical indicators eased:
"The RSI heading lower around 59 and the Momentum turning higher right after entering negative territory, all of which suggest that the pair can correct lower, particularly on a break below 112.15 the immediate support. Nevertheless, the pair is far from bearish and a decline could be short-lived if buyers decide to add on dips. The key to the downside is the 111.40 level, as only below it, bulls will likely give up."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.