Refer USD/JPY chart on Trading View
- USD/JPY extends weakness after opening with a bearish gap, breaks below 110-EMA, bias lower.
- Strong risk-off sentiment continues after Friday's mayhem around the Turkish Lira and off-shore dollar liquidity stresses.
- Heavy selling seen across JPY crosses weighing on USD/JPY. Fears of contagion likely triggered following record slide in Turkish Lira on Friday.
- Technical indicators have turned bearish raising scope for further downside.
- Momentum studies are bearish, Stochs and RSI sharply lower and DMI supports weakness.
- Price action has broken below cloud and upside remains capped at 55-EMA. Break above 55-EMA could see some consolidation.
- Cloud offers immediate support at 110.09. Break below will see test of 109.94 (nearly converged 200-DMA and 38.2% Fib).
Support levels - 110.09 (cloud top), 109.94 (nearly converged 200-DMA and 38.2% Fib), 109.36 (June 25/26 low)
Resistance levels - 110.75 (55-EMA), 110.88 (5-DMA), 111
Call update: Our previous call (https://www.econotimes.com/FxWirePro-USD-JPY-finds-strong-support-at-55-EMA-break-below-to-see-further-weakness-1414352) has hit TP1.
Recommendation: Bias lower. Hold for further downside.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 51.4142 (Neutral), while Hourly JPY Spot Index was at 115.363 (Bullish) at 0330 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.


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