FXStreet (Mumbai) – Having faced rejection at 119.75 in last hours, the USD/JPY pair is seen accelerating to the downside tracking the sharp declines in the Japanese stocks as risk-off intensifies.
USD/JPY heading towards 200-SMA on 1hr sticks?
The offered tone around the USD/JPY pair gathered pace over the last hours as a renewed bout of risk-aversion gripped the Japanese stocks, with the Nikkei 225 index hitting fresh low just ahead of 17k mark, down over -3.50% on the day. At the time of writing, the major drops -0.40% at 119.48, hovering within a striking distance of fresh session lows of 119.42.
Moreover, markets completely ignored BOJ’s Kuroda dovish comments, as the major halted its recovery near 119.75 levels and resumed the downside momentum against the backdrop of the renewed sell-off in oil prices and China slowdown fears, which continues to boost the demand for the safe-haven yen.
Looking ahead, a host of crucial US economic data, including the jobs data, will be closely eyed for fresh cues on the Fed’s interest rates outlook.
USD/JPY Technical levels to watch
In terms of technicals, the immediate resistance is located at 119.92/120 (daily high/ round number). A break above the last, the major could test 120.22/59 (1h 100-SMA/ 5-DMA). While to the downside, the immediate support is seen at 119.34/29 (daily S1/ 1h 200-SMA) and below that at 119/118.84 (psychological levels/ daily S2).
(Market News Provided by FXstreet)