USD/JPY Forecast: Rising odds for a visit to 101.00 (and below)

USD/JPY has come under extra downside pressure at the beginning of the week and it has breached the 102.00 mark, area last visited in November 2016.

Increasing and unremitting fears over the fast-spreading coronavirus continue to weigh on global sentiment and bolster further the demand for the safe haven universe on Monday. In addition, the downside pressure on US yields have dragged yields of the 10-year reference to fresh historic lows once again, also collaborating the downside in the pair.

In the meantime, the negative view on the pair looks unchanged, at least in the short-term scenario, as speculations on the likeliness of another interest rate cut by the Federal Reserve at the March 17-18 meeting remain on the rise and keep the selling mood on the buck well and sound.

Short-term technical outlook

Against the current backdrop of unabated risk aversion, there is limited (if any at all) chances of a recovery in USD/JPY, leaving occasional bullish attempts (mainly on the back of the extremely “oversold” condition in the pair) as selling opportunities. Looking further south, a breach of Monday’s lows in the mid-101.00s should expose the next support of relevance at 101.19 (monthly low November 2016) ahead of the psychological 100.00 barrier.