FxWirePro: USD/JPY slips lower, fresh JPY buying amid a drop in S&P 500 futures drags

USD/JPY chart on Trading View used for analysis

• USD/JPY extends weakness on the first day of the week, trades 0.17% lower at 109.34 at 0415 GMT.
   
• Fresh JPY buying amid a drop in S&P 500 futures weighs on the pair. US S&P 500 futures kicked-off the week on a negative note.
   
• Yen remained unfazed by the Bank of Japan's December meeting minutes.The central bank said it is appropriate to continue easing persistently.
   
• Selling pressure around the greenback to remain unabated. US-China trade war and the slowdown in the global economy to add further pressure.
   
• For the week ahead, focus shall be on the Fed and nonfarm payrolls. Analysts expect a mean-revert to 150k following a larger-than-expected jump in December. 
   
• The unemployment rate is expected tick up to 4.0% largely reflecting furloughed government workers during the shutdown. 
   
• Major trend is bearish. Technical studies on the intraday charts have turned bearish. RSI below 50 and Stochs are on verge of bearish roll-over from overbought levels.
   
• We see scope for further weakness. Test of next major support at 38.2% Fib likely.
   
• Decisive breakout above 21-EMA could see further gains. Scope then for test of 61.8 % Fib at 110.77. 

Support levels - 109, 108.43 (38.2% Fib), 107.77 (Jan 10 low)

Resistance levels - 109.61 (21-EMA), 110, 110.72 (55-EMA)

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