USD/JPY Dips Lelow 110.00 Level
pair failed to built on to its early Asian session up-move to 110.38
and has now dropped back below 110.00 handle to currently trade near
session low at 109.90.
On Wednesday, expectations of hawkish tone, which eventually materialized during NY session, assisted the pair to decisively break-out of its recent trading range and surge past 110.00 handle, to test 50-day SMA.
However, on Thursday a sell-off in European equities triggered a global risk-off sentiment and boosted the safe-haven appeal of the Japanese currency, dragging the USD/JPY lower.
From session peak level of 110.38, the USD/JPY pair has witnessed a steady decline. However, considering that the pair has extended the break-out momentum, it seems unlikely to witness a sharp correction from current levels.
Technical levels to watch
From current level, the pair's reversal from 3-weekly high level could possibly get extended till 109.50-55 trading range break-out point turned immediate support. Failure to hold this immediate support could further drag the pair towards 109.00 round figure mark, below which the near-term bullish bias gets negated and the pair might resume it medium-term downward trajectory.
On the flip side, 50-day SMA near 110.10 now become immediate hurdle to clear, which if conquered opens room for further appreciating move for the pair, towards reclaiming 111.00 round figure mark.