USD/JPY drops to 4-month lows and breaches 106.00

USD/JPY comes under extra pressure and breaks below 106.00.
The dollar’s sell-off remains unabated on Friday.
Manufacturing/Services PMIs missed estimates in July.

Pablo Piovano FXStreet

USD/JPY has accelerated the decline and is now putting the 106.00 support to the test on Friday.

USD/JPY weaker below the 106.60 region

USD/JPY has broken below the lower bound of the multi-session consolidative range around 106.60, intensifying the downside amidst the sharp and unremitting pullback in the dollar.

Markets appear to have shifted to the risk-off mode in the wake of the opening bell in Wall St., with the main stock benchmarks trading in the red and the rest of the safe haven universe advancing modestly.

In the US calendar, Markit’s flash Manufacturing PMI came in at 51.3 and Services PMI at 49.6 for the current month, both prints below estimates. Later in the NA session will come June’s New Home Sales.

USD/JPY levels to consider

As of writing the pair is losing 0.84% at 105.93 and faces immediate contention at 105.05 (low Aug.12 2019) seconded by 104.44 (monthly low Aug.26 2019) and the 101.18 (2020 low Mar.9). On the other hand, a breakout of 107.41 (100-day SMA) would aim to 108.16 (monthly high Jul.1) and finally 108.32 (200-day SMA).

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Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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