FxWirePro: USD/JPY erases corrective bounce, recovery capped at 5-DMA, risk-off keeps yen supported

USD/JPY chart - Trading View 

• USD/JPY edges lower from session highs at 110.05, risk-off keeps yen supported.
   
• The planned US tariff hike on Chinese goods from 10% to 25% is still set to take effect at 00:01 hours Friday New York time, 12:01 GMT. 
   
• US-China trade talks expected to extend beyond the tariffs hike deadline. If both sides again fail to reach a deal, then Beijing may respond with its own set of tariff hikes.
   
• Escalating trade war fears keep demand for haven currencies like JPY and the Swiss Franc.
   
• Technical indicators support weakness in the pair. Momentum with the bears. 
   
• Break below 38.2% Fib eyes 108.50 (Jan 31st low) and then 61.8% Fib at 107.61.
   
• 5-DMA is immediate resistance at 110.12. Break above could see gains till cloud top .

Call update: Our previous call (https://www.econotimes.com/FxWirePro-USD-JPY-breaks-below-daily-cloud-eyes-382-Fib-at-10944-1533882) has almost hit TP1.

Recommendation: Book partial profits at lows. Hold for further downside.

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.