USD/JPY extends its losing streak for the fourth straight session, risk-off intensifies after Yuan devaluation, supporting Yen higher.
- The pair hit fresh multi-month lows at 118.35 before attempting a minor recovery to 118.80 levels.
- Risk-off sentiment continues to dominate on renewed China woes, underscored by poor PMI data, markets will track sentiment across European equities (tipped for a lower start).
- Later in the NY Session US economic data and the FOMC minutes may provide the much-needed impetus to the greenback.
- Target levels in the previous call have been met, the pair finds strong support at 118.30 levels, breaks below will target 117.71 (78.6 Fib of 116.08 to 123.76 rise).
- On the other side a close above 119.01 which is 61.8% Fib of 116.08 to 123.75 rise will see tests of 120 levels.
Resistance Levels:
R1: 119.01 (61.8% Fib of 116.08 to 123.75 rise)
R2: 119.16 (Session highs Jan 6)
R3: 119.68 (Hourly Cloud Top)
Support Levels:
S1: 118.30 (Trendline support)
S2: 118.07 (Daily Low Oct 15)
S3: 117.71 (78.6% Fib of 116.08 to 123.75 rise)
