USD/JPY Forecast: Following stocks, waiting for US data

USD/JPY Current price: 113.92

Following stocks, waiting for US data. The USD/JPY pair trades lower this Monday, with the Japanese yen strengthening on the back of stocks' decline. Worldwide indexes are in the red at the beginning of the week, although there is no clear catalyst behind the movements. The US will release some data at the beginning of the American session, including the Chicago PMI index and Pending Home Sales, which if positive, may help the greenback to recover some ground. In the meantime, and according to the technical picture, the risk remains towards the downside, as the pair is trading 100 pips below its daily opening, while in the 1 hour chart, the technical indicators have turned lower below their mid-lines. In the same chart however, the 200 SMA is providing an immediate short term support around 112.80, while the 100 SMA stands around 112.45. In the 4 hours chart, the price retreated after failing to overcome a bearish 100 SMA, while the technical indicators have lost bearish strength within positive territory, retreating from overbought territory. It will take a clear break below 112.45, to confirm a stronger decline in the pair during the upcoming sessions, with the market then pointing to a test of 111.60.

Support levels: 112.80 112.45 112.00

Resistance levels: 113.20 113.70 114.10

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