USD/JPY drops to fresh session lows, back closer to 108.00 handle


  • Bulls failed to capitalize on the overnight rebound and shrug off a modest USD uptick.
  • Rising US bond yields and hotter-than-expected US PPI did little to lend any support.
  • Technical selling below 200-hour SMA intensifies the intraday slide in the last hour.

The USD/JPY pair dropped to fresh session lows in the last hour, with bears now eyeing a move towards challenging the 108.00 round figure mark.

Having failed to capitalize on the overnight goodish bounce further beyond mid-108.00s, the pair came under some renewed selling pressure on the last trading day of the week and seemed rather unaffected by a fresh wave of US Dollar buying interest. 

Against the backdrop of Thursday's hotter-than-expected US CPI report, the latest US Producer Price Index (PPI) also came in stronger than consensus estimates and further dampened expectations for an aggressive monetary easing by the Fed later this month.

The same was evident from a follow-through pickup in the US Treasury bond yields, which underpinned the greenback demand but failed to impress the bulls. Even a positive trading mood around equity markets failed to lend any support or stall the intraday slide. 

The lack of any progress in the US-China trade negotiations - reaffirmed by not so optimism comments by the White House adviser Peter Navarro seemed to be the only factor underpinning the Japanese Yen's safe-haven demand and exerting pressure on the major.

Meanwhile, the latest leg of a sudden drop of around 20-pips over the past hour or so could further be attributed to some intraday technical selling below 200-hour SMA as traders look forward to comments by Chicago Fed President Charles Evans for a fresh impetus.

It would now be interesting to see if the pair is able to find any buying interest at lower levels or the current pullback marks the resumption of this week's rejection slide from the 109.00 handle, or six-week tops set on Wednesday - ahead of the Fed Chair Jerome Powell's dovish remarks.

Technical levels to watch

USD/JPY

Overview
Today last price 108.1
Today Daily Change -0.39
Today Daily Change % -0.36
Today daily open 108.49
 
Trends
Daily SMA20 108.06
Daily SMA50 108.86
Daily SMA100 110.11
Daily SMA200 110.8
Levels
Previous Daily High 108.54
Previous Daily Low 107.86
Previous Weekly High 108.64
Previous Weekly Low 107.53
Previous Monthly High 108.8
Previous Monthly Low 106.78
Daily Fibonacci 38.2% 108.28
Daily Fibonacci 61.8% 108.12
Daily Pivot Point S1 108.06
Daily Pivot Point S2 107.62
Daily Pivot Point S3 107.38
Daily Pivot Point R1 108.73
Daily Pivot Point R2 108.97
Daily Pivot Point R3 109.41

 

 

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