The USD/JPY pair remains heavily sold-off so far this Tuesday, now keeping its range near two-week troughs struck at 111.99 handle.
A break below the last, downside will open up towards a test of the key support located between 111.67-111.45, the confluence zone of 50 and 100-day moving averages.
The sell-off in the major is mainly driven by aggressive USD selling across the board, in response to Trump’s Healthcare bill failure again and the resultant worries over the Trump administration in achieving the reform plans.
Meanwhile, dovish Yellen’s testimony combined with weaker-than expected US CPI figures continue to undermine the sentiment around the buck.
Further, persisting risk-off trades amid sharp declines seen in the Asian equities, particularly the Japanese stocks, boosted the safe-haven flows in the Yen and collaborated to the weakness in the major.
Markets now look forward to the sentiment on the global equities for fresh trading impetus, as the US docket remains relatively quite today.
USD/JPY Technical levels
A break below 112 (round figure) would open doors for 111.67 (50-DMA). A break lower would yield a test of 111.50/43 (psychological levels/ 100-DMA). To the top, a daily close above 20-DMA at 112.92 would shift risk in favor of a re-test of the recent high near 114.50 levels.
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