USD/JPY Price Analysis: Surrenders 130.00 as risk-off profile fades

USD/JPY has dropped below the psychological support of 130.00 amid a recovery in the risk-on profile.
The sustainability of the asset below the 200-EMA indicates that the long-term trend is bearish.
An oscillation in the bearish range by the RSI (14) signals more weakness ahead.

Sagar Dua FXStreet

The USD/JPY pair surrendered the psychological support of 130.00 in the early European session. The major has witnessed a steep fall after slipping below 130.50 in Tokyo amid an improvement in investors’ risk appetite.

S&P500 futures have managed to shift into the green trajectory after a weak opening post-long weekend, which signals that the risk aversion theme has faded. The US Dollar Index (DXY) is struggling to sustain above a two-week low around 103.15.

On the daily scale, the asset has surrendered the horizontal support placed from August 2 low around 130.40. The 20-period Exponential Moving Average (EMA) at 134.00 is continuously acting as a major barricade for the US Dollar. Also, the asset has shifted comfortably below the 200-EMA at 135.00, which indicates that the long-term trend is bearish.

Meanwhile, the Relative Strength Index (RSI) (14) has shifted into the bearish range of 20.00-40.00, which indicates that the bearish momentum is already active.

It would be prudent to wait for a pullback move to near the psychological resistance of 130.00 for building short positions, which will drag the asset towards May 4 low at 128.63 followed by May 24 low at 126.36.

On the flip side, a rebound move above December 29 high at 134.50 will drive the asset toward December 7 low around 134.00. A breach above the latter will send the asset toward December 20 high at 137.47.

USD/JPY daily chart

USD/JPY

Overview
Today last price	129.65
Today Daily Change	-1.07
Today Daily Change %	-0.82
Today daily open	130.72

Trends
Daily SMA20	134.6
Daily SMA50	139.2
Daily SMA100	141.08
Daily SMA200	136.26

Levels
Previous Daily High	131.13
Previous Daily Low	130.62
Previous Weekly High	134.5
Previous Weekly Low	130.78
Previous Monthly High	138.18
Previous Monthly Low	130.57
Daily Fibonacci 38.2%	130.82
Daily Fibonacci 61.8%	130.94
Daily Pivot Point S1	130.52
Daily Pivot Point S2	130.31
Daily Pivot Point S3	130
Daily Pivot Point R1	131.03
Daily Pivot Point R2	131.34
Daily Pivot Point R3	131.55

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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