USD/JPY Outlook: Bears pressure pivotal support at 104.18, break of which would risk drop to 2020 low

Slobodan Drvenica Windsor Brokers

The dollar holds firmly in red vs yen for the fifth straight day and on track for a weekly fall of approx. 1.6% (the biggest weekly drop since the second week of June.

The dollar suffered from dovish Fed, risk mode and downbeat US data that point to a slowdown in economic recovery.

Bears pressure July’s low at 104.18 after generating strong signal on Thursday’s close below 104.86 Fibo support (76.4% of 104.18/107.04 ascend).

The downtrend could accelerate on firm break of 104.18 trigger that would unmask 2020 low at 101.18 (9 Mar).

Firm bearish setup of technical studies on daily and weekly chart supports bears as this week’s massive bearish candle is expected to weigh on the action next week.

Oversold daily techs warn that bears may take a breather in coming sessions, with upticks to provide fresh selling opportunities while capped under barriers at 105.20/30 zone.

Res: 104.86; 105.03; 105.28; 105.59
Sup: 104.18; 103.51; 103.09; 102.41

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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