- USD/JPY tracks fall in the US 10-year treasury yield and the flattening of the yield curve.
- The major hit lowest level for the month at 113.03 before paring some losses to currently trade at 113.21 levels.
- Upbeat Japanese GDP number released earlier today failed to impress yen bulls.
- Focus now on US retail sales and inflation numbers which could influence the Fed rate hike odds and in turn the USD.
- Technical studies have turned bearish, RSI and Stochs sharply lower. The pair has broken below 20-DMA.
- Bearish divergence of RSI and Stochs from price action keeps scope for downside. 50-DMA at 112.48 in sight.
- Retrace above 20-DMA currently at 113.63 invalidates bearish bias.
Support levels - 112.98 (23.6% Fib retrace of 107.318 to 114.73 rally), 112.48 (50-DMA), 111.90 (38.2% Fib)
Resistance levels - 113.45 (5-DMA), 113.63 (20-DMA), 114, 114.50 (trendline)
Recommendation: Good to go short on rallies around 113.30/40, SL: 113.75, TP:
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -26.6274 (Neutral), while Hourly JPY Spot Index was at 38.6669 (Neutral) at 0330 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest
