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USD/JPY to nosedive toward the 104.45 area

USD/JPY is trading around 105.30, its lowest in over four months. The pair could accelerate the slump and approach 104.00 level as it is showing bearish and oversold conditions, Valeria Bednarik, Chief Analyst at FXStreet, reports.

Key quotes

“Japan published the May All Industry Activity Index, which resulted in -3.5% from -7.6% in the previous month. The Leading Economic Index for the same month was downwardly revised to 78.4 while the Coincident Index came in at 73.4, below the previous estimate of 80.1. Ahead of Wall Street’s opening the US will publish June Durable Goods Orders seen up by 7.2% after advancing 15.7% in the previous month.”

“The USD/JPY pair is oversold yet bearish in the short-term, without signs of downward exhaustion. The 4-hour chart shows that technical indicators head firmly lower despite being in extreme levels, while the 20 SMA accelerated its decline, heading south almost vertically over 100 pips above the current level.” 

“The ongoing decline has room to extend towards the 104.45 area, where the pair has several weekly lows from these last years.”


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