USD/JPY bulls finally cave in below 110 handle, bears look to 61.8% Fib
- USD/JPY losing its footing and heads to next area of support.
- Bears can look to golden ration and mid 108 handle.
USD/JPY is trading at 109.64 within a range of between 109.59 and 109.86 in a relatively risk-off environment as the media headlines are full of the coronavirus as it spreads internationally. USD/JPY mutated into an offer, falling to the lost levels since 13th January, testing a support structure complied of Fibonacci and prior support and resistance that is likely to hold the initial test.
USD/JPY has been unable to break on the 110 handle, and the bulls have succumbed to the bear's commitments, pressuring the pair below the hourly 200 moving average, resisted on pullbacks at the 50-hour moving average in the 109.80s. There has been a lack of events to really distract the markets from the threat of the virus and even the Trump'simpeachment trial has taken a back seat to it. US stock markets were mixed as well and without a full commitment from US dollar bulls, (DXY struggles) the price finally collapsed.
Coronavirus capturing traders attentions
China confirms 571 total cases of new coronavirus – China State TV
"Fresh headlines on the spread of the Wuhan virus initially rattled market sentiment, with the Chinese yuan slipping to a 12 day low,"
analysts at Westpac explained.
A void of US data left for the week may mean that USD/JPY will be lower for longer before it can attract fresh demand for the next significant impulse to the upside and attention will be for a look in below support and the 21-Day moving average with eyes down to the 200-day moving average located at the next structure of support in the mid 108 handle which meets the golden ratio of the 61.8% target.