USD/JPY tumbles to near 2-month lows, farther below 112.00 handle
• The post-FOMC rebound from the 112.00 handle turned out to be short-lived.
• JPY benefits from reviving safe-haven demand and prompts some fresh selling.
• Technical selling below the crucial 100-DMA support accelerates the downfall.
The USD/JPY pair struggled to build on the post-Fed recovery move and came under some intense selling pressure on Thursday.
Wednesday's not so dovish FOMC statement/economic projections, now foreseeing two rate hikes in 2019 vs. three in September, did provide a minor lift to the US Dollar and assisted the pair to bounce off the 112.00 neighborhood.
The greenback, however, failed to capitalize on the overnight rebound, which coupled with a fresh wave of global risk-aversion trade boosted the Japanese Yen's safe-haven status and prompted some aggressive selling on Thursday.
With the global flight to safety turning out to be a key factor exerting some heavy downward pressure on the major, bearish traders seemed rather unaffected by the Bank of Japan's status quo policy decision and unwillingness to deviate from current policy stance.
Meanwhile, possibilities of some heavy stops being triggered on a sustained weakness below the crucial 100-day SMA support, and the 112.00 handle, further aggravated the selling pressure and collaborated to the pair's latest leg of sharp fall over the past hour or so.
In absence of any major market moving economic releases, the pair remains at the mercy of broader market risk-sentiment, though oversold conditions on hourly charts now warrant some consolidation or a minor rebound.
Technical levels to watch
Today Last Price: 111.83
Today Daily change: -76 pips
Today Daily change %: -0.675%
Today Daily Open: 112.59
Previous Daily SMA20: 113.18
Previous Daily SMA50: 112.99
Previous Daily SMA100: 112.41
Previous Daily SMA200: 110.85
Previous Daily High: 112.64
Previous Daily Low: 112.09
Previous Weekly High: 113.71
Previous Weekly Low: 112.24
Previous Monthly High: 114.25
Previous Monthly Low: 112.3
Previous Daily Fibonacci 38.2%: 112.43
Previous Daily Fibonacci 61.8%: 112.3
Previous Daily Pivot Point S1: 112.24
Previous Daily Pivot Point S2: 111.88
Previous Daily Pivot Point S3: 111.68
Previous Daily Pivot Point R1: 112.8
Previous Daily Pivot Point R2: 113
Previous Daily Pivot Point R3: 113.35