HomeContributorsTechnical AnalysisUSD/JPY Outlook: Accelerates Through Key 110 Support Zone On Fresh Risk Aversion

USD/JPY Outlook: Accelerates Through Key 110 Support Zone On Fresh Risk Aversion

The USDJPY accelerated sharply lower in early European trading on Thursday, deflated by fresh risk aversion, mainly driven by a sharp fall in China’s government bond yields after authorities announced cuts in banks’ mandatory reserves in order to keep monetary policy stable, which investors took as a strong easing signal.

Fresh weakness probes through pivotal 110 support zone (bull-trendline off 107.47 low/Fibo 38.2% of 107.47/111.65/psychological), with a daily close below these levels to generate a strong bearish signal.

Rising 55DMA offers support at 109.65, with stronger acceleration to risk test of 109.13/07 (100DMA/Fibo 61.8%).

Daily chart studies are gaining negative momentum and support the action, but oversold stochastic may provide headwinds and slow bears.

Solid resistances at 110.60 zone (broken 20DMA/session high) should cap extended upticks and keep fresh bears in play.

Res: 110.06, 110.16, 110.60, 110.76.
Sup: 109.65, 109.31, 109.07, 108.72.

Windsor Brokers Ltd
Windsor Brokers Ltdhttp://www.windsorbrokers.com/
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