- USD/JPY tests levels below 106 handle before paring some losses to currently hover around 106.10 levels.
- The pair is extending downside from yesterday after Trump's tariff headlines send markets in a tailspin.
- President Trump announced a 25% tariff on imported steel and a 10% tariff on aluminium.
- In response, European Commission president Juncker said the EU will “bring forward in the next few days a proposal for WTO-compatible countermeasures against the US.
- Technical studies have turned bearish. RSI and Stochs are biased lower. -ve DMI is dominant and rising.
- The major has been in a downward spiral since highs of 114.737 in Nov 2017 and minor recovery attempts have been capped at 20-DMA.
- Next bear target lies at 105.40 (major trendline support). Violation there could see further weakness.
Support levels - 105.55 (Feb 2018 lows), 105.40 (trendline), 105
Resistance levels - 106.38 (61.8% Fib), 106.61 (5-DMA), 107, 107.48 (20-DMA)
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