USD/JPY has seen an aggressive sell-off after failing to sustain its break above the highs posted in the second half of July at 110.60/70. In the view of economists at Credit Suisse, the pair is set to retest August lows and potential trend support at 108.86/73.
USD/JPY back below its 55-DMA at 110.16
“Whilst resistance at 109.76 caps the immediate risk is seen lower with support seen at 109.24 initially, then the August low and potential trend support at 108.86/70. We would look for an attempt to find a fresh floor here.”
“Below 108.70 would see the immediate risk stay lower with support seen next at 108.57, then the 38.2% retracement of the January/July rally at 108.19.”
“Above 109.76 can ease the immediate downside bias for a recovery back to the 55-day average at 110.16 with the immediate risk seen lower whilst below 110.31/33.”
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