USD/JPY slumps to fresh monthly lows near 103.60 on broad USD weakness

USD/JPY is falling for the fourth straight day on Monday.
US Dollar Index touched fresh multi-year lows below 90.50.
Wall Street's main indexes look to open sharply higher.

Eren Sengezer FXStreet

After closing the previous three trading days in the negative territory, the USD/JPY pair extended its slide on Monday and slumped to its lowest level since early November at 103.59. As of writing, the pair was down 0.38% on a daily basis at 103.62.

USD selloff intensifies

The broad-based USD weakness seems to be causing USD/JPY to remain under bearish pressure. On Monday, the US Dollar Index (DXY) slumped to its lowest level since April 2018 at 90.43 as the upbeat performance of major European currencies, especially the GBP, caused the greenback to lose interest. At the moment, the DXY is losing 0.32% at 90.47.

In the meantime, the positive shift witnessed in market sentiment could limit USD/JPY's downside in the second half of the day.

Coronavirus vaccine rollout and renewed hopes for an EU-UK trade deal are allowing risk flows to dominate the financial markets at the start of the week. Reflecting the risk-on environment, the S&P 500 Futures are up 0.7% on the day and the 10-year US Treasury bond yield is rising by more than 2%.

Earlier in the day, the data from Japan showed that Tankan Large Manufacturing Outlook and Non-Manufacturing Outlook both improved more than expected for the fourth quarter but was largely ignored by the market participants. The US economic docket won't be featuring any significant data releases on Monday.

Technical levels to watch for

USD/JPY

Overview
Today last price	103.69
Today Daily Change	-0.35
Today Daily Change %	-0.34
Today daily open	104.04

Trends
Daily SMA20	104.19
Daily SMA50	104.69
Daily SMA100	105.22
Daily SMA200	106.38

Levels
Previous Daily High	104.28
Previous Daily Low	103.82
Previous Weekly High	104.58
Previous Weekly Low	103.82
Previous Monthly High	105.68
Previous Monthly Low	103.18
Daily Fibonacci 38.2%	104
Daily Fibonacci 61.8%	104.11
Daily Pivot Point S1	103.82
Daily Pivot Point S2	103.59
Daily Pivot Point S3	103.36
Daily Pivot Point R1	104.27
Daily Pivot Point R2	104.5
Daily Pivot Point R3	104.73

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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