FxWirePro: USD/JPY subdued amid weakness in Asian equities, upside capped at 55-EMA

USD/JPY chart on Trading View used for analysis

• Risk aversion dominates early Asian trade, equites started the day lower amid escalating concerns over the U.S. - China trade conflict.
   
• JPY remains bid as a safer alternative, drags the pair lower. USD/JPY extends weakness below 55-EMA.
   
• The US Dollar Index, which tracks the greenback against a basket of six major currencies, was largely muted on the day at 96.18.
   
• Technical studies on intraday charts are bearish. 5-DMA is showing a bearish crossover on 20-DMA.
   
• Break below 55-EMA has raised scope for weakness till 110-EMA at 111.92 ahead of major trendline support at 111.70.

Support levels - 112.20 (23.6% Fib), 111.93 (110-EMA), 111.70 (trendline support)

Resistance levels - 112.63 (55-EMA), 112.85 (50-DMA), 113.03 (5-DMA) 

Call update: Our previous call (https://www.econotimes.com/FxWirePro-USD-JPY-hits-new-3-week-lows-at-11261-US-China-trade-woes-dent-sentiment-1460281) is progressing well.

Recommendation: Stay short for targets.

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.