USD/JPY analysis: risk sentiment to keep backing the yen

Valeria Bednarik FXStreet

USD/JPY Current price: 107.82

The USD/JPY pair plunged to a fresh 2017 low of 107.31 early Friday, as investors kept dumping the greenback following Thursday's ECB announcement and rushed towards safety ahead of the storms that hit the US this weekend, and on dovish Fed speakers´ comments. US Treasury yields fell to their lowest since the November election, with the 10-year note benchmark touching 2.02% before ending the week at 2.06%. The yield for the 30-year note ended the week at 2.68%. This week will start with Japan releasing July trade balance and Machinery Orders figures, alongside with industrial data for August. From a technical point of view, the pair has room to extend its decline, having settled below the previous yearly low, and with the daily chart showing that the RSI indicator keeps heading south, around 36, as the 100 and 200 SMAs gain downward strength far above the current level. For the shorter term, the 4 hours chart shows that the price is also well below bearish moving averages, whilst technical indicators settled well into the red, after correcting extreme oversold conditions reached at the beginning of the day, also supporting a new leg lower ahead.

Support levels: 107.65 107.30 106.90

Resistance levels: 108.10 108.45 108.90

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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