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The USD/JPY pair has dropped to over one-month lows, around the 104.20 region. Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, is closely watching a breach of the 104.00 level wich would open the path for further losses.

Key quotes

“USD/JPY came under pressure again, it remains capped by the three-month downtrend at 105.70 and the focus is on the 104.00 September low. This together with the 200-month ma at 103.93 guards the 103.43/78.6% Fibonacci retracement which is the last defence for the 101.18 March low.” 

“Rallies will find initial resistance lines at 105.70 ahead of the seven-month resistance line at 106.23. Only above here will trigger a move to the 200-day ma at 107.17.”