USD/JPY chart - Trading View
Fundamental Outlook:
USD/JPY under pressure amid risk-off, broad risk-aversion is knocking-down the pair.
BOJ Officials said that the central bank will keep buying ETFs as long as needed with eye on market moves.
The BoJ comments failed to have any impact on the yen market. USD/JPY extending declines from near 107.70 region.
Meanwhile, Bank of Japan's governor Kuroda has noted that the downside risks for the economic outlook are large.
He noted that Japan's economy is likely to remain in a severe state, inflation to weaken adding that the global economy is rapidly worsening due to COVID-19.
Technical Analysis:
USD/JPY was trading 0.22% lower on the day at 107.40 at around 03:50 GMT after closing 0.95% higher in the previous session.
Price action has broken above 21-EMA, but is struggling at 55-EMA which is offering stiff resistance at 107.78.
Stochs have rolled over from oversold levels and MACD is showing a bullish crossover on signal line.
Minor trend as evidenced by the GMMA indicator has turned bullish and the parabolic SAR supports upside.
Major Support Levels:
- S1: 107.20 (21-EMA)
- S2: 106.80 (5-DMA)
- S3: 106.70 (Cloud base)
Major Resistance Levels:
- R1: 107.78 (55-EMA)
- R2: 108.22 (200-DMA)
- R3: 108.85 (50% Fib)
Summary: Technical indicators are turning bullish in the near-term. Trade war and COVID-19 fears keep demand for the yen.
Guidance: Watch out for break above 55-EMA for further upside. Next bull target lies at 200-DMA at 108.22 ahead of 50% Fib at 108.85.
