USD/JPY Price Analysis: Bears challenge 200-DMA/ascending trend-line confluence support

USD/JPY added to this week’s heavy losses and tumbles to over three-week lows.
Bloodbath across global equities could lead to an eventual near-term bearish break.

Haresh Menghani FXStreet

The USD/JPY pair continued losing ground through the early European session on Friday and tumbled to 3-1/2 week lows, around mid-108.00s in the last hour. The pair dropped closer to monthly lows and is challenging a confluence support comprising a near five-month-old ascending trend-line and the very important 200-day SMA.

Growing market concerns over the outbreak of the deadly coronavirus outside of China and its impact on the world economy deepened a weeklong global stock market rout on Friday. This might continue to boost the Japanese yen’s perceived safe-haven status and thus, support prospects for a fresh near-term bearish breakdown.

Meanwhile, technical indicators on the daily chart have been gaining negative momentum and are still far from being in the oversold territory. Some follow-through selling will reinforce the bearish bias and stage for an extension of the pair’s recent sharp pullback from multi-month tops – levels beyond the 112.00 mark set on February 20.

On the flip side, any attempted recovery now seems to confront some fresh supply near the 108.75-80 region. A sustained strength might trigger a short-covering move and has the potential to lift the pair back the 109.00 mark. The momentum could get extended, albeit seems more likely to remain capped near 100-day SMA, around the 109.20 region.

USD/JPY daily chart

Technical levels to watch

USD/JPY

Overview
Today last price	108.58
Today Daily Change	-1.26
Today Daily Change %	-1.15
Today daily open	109.84

Trends
Daily SMA20	110.05
Daily SMA50	109.61
Daily SMA100	109.23
Daily SMA200	108.41

Levels
Previous Daily High	110.47
Previous Daily Low	109.69
Previous Weekly High	112.23
Previous Weekly Low	109.66
Previous Monthly High	110.29
Previous Monthly Low	107.65
Daily Fibonacci 38.2%	109.99
Daily Fibonacci 61.8%	110.18
Daily Pivot Point S1	109.53
Daily Pivot Point S2	109.22
Daily Pivot Point S3	108.75
Daily Pivot Point R1	110.31
Daily Pivot Point R2	110.78
Daily Pivot Point R3	111.09

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD treads water above 1.1850 amid thin trading

EUR/USD stays defensive but holds 1.1850 amid quiet markets in the European hours on Monday. The US Dollar is struggling for direction due to thin liquidity conditions as US markets are closed in observance of Presidents' Day.

GBP/USD flat lines as traders await key UK and US macro data

GBP/USD kicks off a new week on a subdued note and oscillates in a narrow range near 1.365 in Monday's European trading. The mixed fundamental backdrop warrants some caution for aggressive traders as the market focus now shifts to this week's important releases from the UK and the US.

Gold sticks to intraday losses; lacks follow-through

Gold remains depressed through the early European session on Monday, though it has managed to rebound from the daily trough and currently trades around the $5,000 psychological mark. Moreover, a combination of supporting factors warrants some caution for aggressive bearish traders, and before positioning for deeper losses.

Bitcoin, Ethereum and Ripple consolidate within key ranges as selling pressure eases

Bitcoin and Ethereum prices have been trading sideways within key ranges following the massive correction. Meanwhile, XRP recovers slightly, breaking above the key resistance zone. The top three cryptocurrencies hint at a potential short-term recovery, with momentum indicators showing fading bearish signs.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Monero Price Forecast: XMR risks a drop below $300 under mounting bearish pressure

Monero (XMR) starts the week under pressure, recording a 4% decline at press time on Monday after a 7% drop the previous day, putting the $300 support zone in focus.