FxWirePro: USD/JPY closes TRY-led bearish gap open, intraday bias bearish below 200H MA

USD/JPY chart - Trading View 

USD/JPY bounced back from session lows and was trading at 108.75 at around 04:22 GMT.

The pair opened with a bearish gap following President Tayyip Erdogan decision to replace Turkey's hawkish central bank governor with a like-minded critic of high-interest rates.

Speculation that the decision might lead to short covering by Japanese individual investors (invested in Turkey lira for its high rates) led to spike in yen.

On the other side, the greenback remained bid amid concerns that the events in Turkey will cause disruptions in other financial markets.

After dovish comments from Fes chair Jerome Powell last week, focus will be on Fed speakers this week for impetus.

Technical indicators have turned bearish on the intraday charts. 5-DMA has turned and is capping upside.

Price action has slipped below 200H MA and is on track for further downside. That said, 'Golden Cross' on the daily charts will limit downside in the pair.

Strong support is seen at 107.85 (nearly converged 20-DMA and 21-EMA). Major weakness only on break below.