- Yen remains bid as risk-off persists triggered by the weekend’s hydrogen bomb test conducted by North Korea.
- USD/JPY has opened with a bearish gap and is extending downside to slip below 20-DMA support at 109.68.
- Also, disappointing US labour market report (Fri) which dented Dec Fed rate hike keeps sentiment around the US dollar sour.
- US markets remain closed on account of Labour Day this Monday and price action will continue to be driven by risk sentiment.
- We see weakness on intraday charts. Strong support seen at channel base at 108.70.
- Bullish divergence keeps scope for upside. Cloud on weekly charts is offering strong support, we see weakness on close below.
Support levels - 109, 108.80 (June 14 lows), 108.60 (Aug 18 lows)
Resistance levels - 110 (5-DMA), 110.61 (23.6% Fib), 110.95 (Aug 16 high)
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