USD/JPY: Sent Crashing to Test 2016 Lows
USD/JPY
is down to the test the 108 handle in this livelier than usual start to
the week. USD/JPY opened early Asia with a large bearish gap of over
0.70% marking lows of 108.12 before further supply took the pair down to
lows of 107.89 ahead of the Tokyo open.
The Yen has been a
strong performer since the end of March business, sent from being on
the113 handle down to recent lows of 107.89, even stirring up concerns
over the risks of the BoJ intervening. Today has been another strong
downside day so far, with the price opening in a bearish gap from last
week's close of 108.77 to today's 107.89 low in the Tokyo open. The
major story roiling markets at the start of the week is the news that
OPEC and non-OPEC ministers concluded the Doha talk without an
agreement.
Yen
was a big gainer in this event and uncertainty has heightened again
ahead of the European and U.S. coming back to soak it up. At the same
time, U.S. interest rates were lower at the close last week with the US
10yr treasury yield falling from 1.79% to 1.75%. With the price of oil
collapsing today, yields could be further pressured at the start of the
week and continue to weigh on the major.
From the calendar, we
have New York Fed president Dudley making his opening remarks at a
conference and Minneapolis while Fed's Kashkari delivers a speech with
Q&A.
USD/JPY levels
The downside
levels are 106.63 fibo and the 105.84 200 month ma. This could be a
strong level of support below 107.60 and S3. To the upside, the nearby
resistance lies at 108.80, above the gap, and then 109.66/73 ahead of
110.67 (March low). A close above 110.66 and the 20 dma would alleviate
the built up 113.80 downside pressures of late March.
(Market News Provided by FXstreet)
