USD/JPY analysis: still poised to challenge 112.00

USD/JPY Current price: 112.57

The USD/JPY pair extended its multi-week decline by a few pips to 112.45 at the beginning of the week, ending the day not far above it and having topped for the day at 112.89. The Japanese yen appreciated as US Treasury yields kept falling this Monday, with the 10-year benchmark down to 2.48% from previous 2.50%. There are no news scheduled in Japan for the upcoming Asian session, which means that the pair will likely continue trading on sentiment. From a technical point of view, the risk remains towards the downside, as the price held well below its 100 and 200 SMAs both still horizontal  far above the current level in the 4 hours chart, whilst the RSI indicator holds flat at oversold levels and the Momentum hovers back and forth below its 100 line. A downward acceleration below 112.50 should see the pair nearing the 112.00 level, where the pair has the 38.2% retracement of its late 2016 monthly rally, with scope to extend afterwards towards the 111.60 region, where the pair bottomed multiple times this year.

Support levels: 112.50 112.10 111.65

Resistance levels: 113.05 113.50 114.00

View Live Chart for the USD/JPY

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