USDJPY extended yesterday's sell-off below the 108.00 psychological mark today and the mid-level of the Bollinger Band (20-day simple moving average) as well as the 23.6% Fibonacci retracement level of the downfall from 112.40 to 106.77. The pullback on the seven-week high of 109.00 shifted the marginally bullish bias to neutral in the short-term.

Looking at the momentum indicators, the RSI is falling below the 50 level, while the stochastic oscillator has already completed a bearish crossover within its %K and %D lines in the overbought zone, suggesting the end of the bullish phase.

If prices continue to head lower, support should come from the lower Bollinger band, which overlaps with the 107.05 barrier. A drop below it would open the door for the five-month low of 106.77 before attention turns to the 105.65 area.

However, should an upside reversal take form in the congestion area, immediate resistance will likely come from the 40-SMA, around 108.50. A break above this line would hit the upper boundary of the channel near the 38.2% Fibo of 108.90 and the 109.00 round number. More advances could also reach the 50.0% Fibo of 109.60, switching the short-term outlook back to bullish. 

To summarize, USDJPY is currently looking neutral in the short-term timeframe, while in the medium-term the picture is seen bearish unless the price returns to the 109.00 key level. 

USDJPY

Forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD: Stuck in a range, the odds of an aggressive Fed rate cut drop

EUR/USD continues to trade a narrow range amid falling odds of an aggressive easing by the US Federal Reserve (Fed) later this month. The ECB is widely expected to keep rates unchanged, but send out a strong dovish message later this week

EUR/USD News

GBP/USD remains modestly flat as Brexit optimism confronts UK-Iran tension

While optimism surrounding the Brexit helped the GBP/USD pair to start the week on a positive note, geopolitical tensions between the UK and Iran tamed the quote’s upside as it trades near 1.2500 ahead of the London open. 

GBP/USD News

USD/JPY consolidates gains below 108.00 amid risk-off in Asian equities

Having failed to sustain the early gains above the 108 handle, USD/JPY consolidates in a tight range just below the last amid risk-off action in the Asian equities and Abe's victory. Escalating Gulf tensions and a likely smaller Fed rate cut weigh down on the sentiment. 

USD/JPY News

Forex Today: USD cheers Fed’s policy repricing, Gulf tensions rise, and Oil surges

US dollar index rises on falling odds of aggressive Fed rate cuts. Oil surges on escalating Gulf tensions. All eyes on trade and geopolitical developments.

Read more

Gold: Bounces off 23.6% Fibo. towards $1436.50/37 supply zone

Gold is again being bought as it reverses from 23.6% Fibonacci retracement of June-July advances to $1,427 by early Monday. The yellow metal now runs towards $1,436.50/37 horizontal resistance comprising early-month tops.

Gold News

Majors

Cryptocurrencies

Signatures