USD/JPY Forecast: Pressure mounts on the greenback

Valeria Bednarik FXStreet

USD/JPY Current price: 109.30

Japanese data showed signs of economic progress at the end of Q1.
US Treasury yields are under mild-pressure amid a dismal market’s mood.
USD/JPY is technically bearish in the near-term, could extend its slump to sub-109.00.

The USD/JPY pair trades lower in range, as the greenback retains the weakness seen last week. The pair trades near a daily low at 109.28, following the poor performance of Asian and European equities. Meanwhile, US Treasury yields tick lower ahead of the opening, with the yield on the 10-year note down to 1.64% intraday.

Japanese data released at the beginning of the day was generally encouraging. The March Producer Price Index was up 0.8% MoM and 1% YoY, beating expectations. Machine Tool Orders in the same month increased 65%, largely surpassing the previous 36.7% advance. The upcoming American session will bring a 10-year Note Auction and a speech from Fed’s Eric Rosengren.

USD/JPY short-term technical outlook

The pair is set to extend its decline in the near-term, as the 4-hour chart shows that the slide extends below the 20 and 100 SMAs, with the shorter one accelerating south. Technical indicators gain bearish traction within negative levels, in line with another leg lower. The pair bottomed this month at 108.99, the level to break to confirm a steeper decline.

Support levels: 108.95 108.60 108.20

Resistance levels: 109.50 109.95 109.30

View Live Chart for the USD/JPY

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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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