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USD/JPY drops almost 200 pips and falls toward 121.00

FXStreet (Córdoba) - USD/JPY continued to decline and approached 121.00. The pair bottomed at 121.06, the lowest level in a month and then rebounded modestly to the upside. It was trading at 121.15/20, down 1.50%, suffering the biggest daily decline in months.

JPY up, stocks and USD down

A decline in stocks in Wall Street, where the Dow Jones reversed sharply (from +200 to -100 points) and a weak US dollar, pushed USD/JPY to break a key static support located around 122.20. It extended losses afterwards and is consolidating significantly below.

“In the 4 hours chart, the price fell far below its 100 and 200 SMAs, while the technical indicators retain sharp bearish slopes, despite being in oversold territory in line with further declines particularly on a break below the 120.00 figure”, said Valeria Bednarik, Chief Analyst at FXStreet.

The Japanese currency it the best performer across the board on Wednesdays and is rising for the second day in a row. Yesterday it was economic data from Japan and also risk aversion that boosted the yen. Today it continued to move to the upside, ahead of next week FOMC decision.

What will 2016 bring to the Forex traders? Attend our Forex Forecast 2016 - The Panel with Ashraf Laidi, Valeria Bednarik, Boris Schlossberg, Adam Button, Ivan Delgado and Dale Pinkert. Register for the live event on Dec. 18th and get the recording too.

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