FxWirePro: USD/JPY breaks below 200-DMA, more slumps on cards, stay short below 111

• USD/JPY beaten down on the dovish FOMC minutes, extending the drift lower after break below 200-DMA.
   
• US data also disappointed with a big miss in US Durable Goods data adding to pressure on the USD.
   
• The University of Michigan survey was also a drag, slipped in line with the ongoing caution around the inflation outlook.
   
• Momentum indicator is bearish in oversold territory, while the RSI gains traction downwards around 35, suggesting more weakness.
   
• The major is currently holding above 111 levels, we find minor support at 50% Fibo at 111.02.
   
• Break below will see resumption of downside, scope then for test of 61.8% Fib at 110.15.
   
• On the flipside, retrace above 200-DMA could invalidate our bearish bias.

Support levels - 111.02 (50% Fib retrace of 107.318 to 114.73 rally), 110.61 (July 24 low), 110.30 (100W-SMA), 110.15 (61.8% Fib)

Resistance levels - 111.71 (200-DMA), 111.93 (5-DMA), 112.19 (1H 100-SMA)

Call update: Our previous call (http://www.econotimes.com/FxWirePro-USD-JPY-holds-break-below-50-DMA-bears-eye-200-DMA-at-11173-stay-short-1021973) has met all targets.

Recommendation: Good to stay short below 111, SL: 111.75, TP: 110.60/ 110.30/ 110.15

FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -131.217 (Bearish), while Hourly JPY Spot Index was at 24.5246 (Neutral) at 0400 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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