- USD/JPY was beaten below 111 handle as following news of Trump administration's plans for 'new' tariffs on China.
- Trump administration is reportedly planning to publish a list of 'new' tariffs that are to be imposed on $200 billion worth of Chinese goods.
- PBOC adviser has reportedly said that China will consider counter measures should the Trump administration impose additional tariffs on Chinese imports.
- The pair slipped lower to hit session lows at 110.76 before paring losses to retake the 111 handle.
- Technical indicators still hold a bullish bias and price is trading above 200-DMA support.
- Price action has held support at 5-DMA and we see minor weakness on close below. Retrace below 200-DMA could negate bearish bias.
- Price is currently testing major resistance at 111 levels (major trendline), break above could see upside.
- Focus now on the US CPI data due later this week which could impact further direction.
Support levels - 110.79 (5-DMA), 110.45 (21-EMA)
Resistance levels - 111.40 (May 21 high), 112, 112.57 (78.6% Fib)
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 86.9629 (Bullish), while Hourly JPY Spot Index was at -126.91 (Bearish) at 0330 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
