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USD/JPY: Yen was favoured on risk-off - FXStreet

FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained that the USD/JPY pair extended its decline down to 120.57, as the Japanese currency benefited from an increasing risk aversion, which sent stocks plummeting in the US.

Key Quotes:

"The pair presents now a clear bearish tone, albeit there are some macroeconomic events ahead that may well trigger sharp directional moves that can change the whole technical picture."

"The first, will be the release of the Tankan manufacturing report in Japan at the beginning of the week, and the next will be the US Federal Reserve announcement next Wednesday, as if the Central Bank decides to raise rates, the dollar may recover its strength and soar against the JPY."

"At the time being, the price is below its 100 DMA, now acting as an immediate resistance around 121.25, while the technical indicators in the daily chart head sharply lower below their mid-lines, in line with a continued decline.

In the 4 hours chart, the technical indicators turned higher from oversold territory, rather reflecting the latest short term bounce than suggesting an upward continuation for this Monday."

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