USD/JPY Current price: 107.35
The USD/JPY pair nosedived to its lowest since early November 2016, down for the day almost 200 pips, to a low of 107.31 and holding nearby ahead of the US opening. The yen surged as US Treasury yields plunged to their lowest since the November US election resulted in Donald Trump's victory, with the 10-year note yield trading as low as 2.02% late Thursday, to end at the lowest for this year, at 2.06%. The potential catastrophic effects that hurricanes coming this weekend to the US may have on the economy, debt ceiling woes, and the lack of progress in the US growth agenda, all weigh on the greenback, alongside with dovish Fed's speakers stance, diminishing odds of a third rate hike this year. US futures are pointing to open lower, adding to the bearish case for the pair despite the wide intraday range already achieved. From a technical point of view, the pair is extremely oversold in the 4 hours chart, although technical indicators are barely decelerating their declines, far from suggesting the slide is over. In the same chart, the price is over 200 pips below its 100 and 200 SMAs which gain downward strength, but are currently irrelevant. The pair has a strong support now around 106.90, which additional slides below this last being probably short-lived, as speculative interest will likely take profits out of the table, ahead of the weekend. Nevertheless, the risk is towards the downside, and further declines are expected for the upcoming session.
Support levels: 107.30 106.90 106.50
Resistance levels: 107.65 108.00 108.45
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