The U.S dollar has erased Tuesday’s gains against the Japanese yen as risk-off trading sentiment quickly returns to financial markets, following top U.S economic advisor Gary Cohn’s resignation. The USDJPY pair has slumped back towards the key 105.50 support level, with MACD and RSI technical indicators now turning bearish as sellers once again gain control of price-action. Traders now look towards the release of the U.S ADP jobs report and the U.S stock market open, with futures markets pointing to heavy declines.
The USDJPY pair is likely to decline further below the 105.50 level, sellers will likely target the 105.23 and 104.60 support region.
If the USDJPY pair can hold the 105.50 support area, a technical test of the key 106.00 resistance level seems likely.
