- Yen comeback drags USD/JPY to February lows
- USD/JPY cracks key trendline and SMAs and eyes support at 152.00
- Bearish technical structure continues to build up
is sliding for a third consecutive day, dropping below the 100-day moving average (SMA) and approaching 153.00, the lowest level since the beginning of February. The pair has fallen below the prevailing ascending trendline drawn from September, but it still holds well above the 200-day SMA.
Meanwhile, investors are preparing for today’s with expectations pointing to a 70k monthly increase for January. The yen has notably profited from Takaichi’s landslide election win, which triggered a round of verbal intervention by Japanese authorities.
Technical indicators support a bearish momentum, as the RSI is trending down towards the oversold area. Similarly, the stochastic oscillator’s %K line has slid into the oversold area, remaining far below its moving average %D line. Furthermore, the MACD has crossed below its moving average signal line in negative territory.
If USD/JPY continues to drift lower, it could test 152.00, where the pair found key support on January 27 and 28 and where the lower Bollinger band lies. Further down, the 200-day SMA at 150.50 might potentially represent key support.
On the other hand, if the pair manages to bounce back, it could initially attempt to surpass the 100-day SMA at 154.50. Higher, the pair might potentially face key resistance in the 155.50-156.00 area, where the 20- and 50-day SMAs are converging towards the prevailing ascending trendline drawn from September.
To sum up, the yen has managed to gain some lost ground, with USD/JPY having dropped from 157.50 to 153.00 in the last three days. If today’s NFP data is downbeat, then USD/JPY may shortly attempt to break below 152.00.
