- Greenback turns decisively to the downside during the American session.
- USD/JPY retreats further from weekly highs, tests 106.00.
The USD/JPY failed again to hold onto daily gains and dropped to 106.04, hitting a fresh daily low. It continues to trader near the lows, looking at the 106.00 support as the USD remains weak.
The DXY peaked at 93.36 following the US Durable Goods Orders report that came in above expectations, but it then reversed, erasing all gains and dropped to 93.00. At the same time, gold jumped $40, and commodity currencies outperformed. Still, volatility remains limited on Wednesday ahead of Fed’s Powell speech on Thursday at the Jackson Hole symposium.
Higher US yields and a new record in the Nasdaq and the S&P500 only limited the decline in USD/JPY. The pair again turned to the downside after testing the 106.50/60 zone. The mentioned area has become a strong resistance that if broken firmly, should lead to more gains.
On the flip side, if USD/JPY losses 106.00 more weakness seems likely. A short-term uptrend line currently stands near that level, and the slide below would likely gain momentum. The next support is seen at 105.85 (Aug 25 low) and 105.65/70 (weekly low).
Technical levels
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