USD/JPY to accelerate its decline on a break below 103.17

USD/JPY has reached a daily low of 103.25, now trading a handful of pips above this last. The pair has room to extend its decline and is poised to challenge this year’s low of 103.17, Valeria Bednarik, Chief Analyst at FXStreet, reports.

Key quotes

“The upbeat sentiment finds support in US stimulus talks. The government would shut down on Friday if no additional funding is approved, so there’s a good chance that they will clinch an agreement before the weekend. Investors are also optimistic about Brexit talks, although the latest headlines indicate that fisheries are still an obstacle.”

“The US will publish November Retail Sales, foreseen contracting 0.3%. Later in the day, the US Federal Reserve will unveil its latest monetary policy decision. The central bank will likely maintain its wait-and-see stance but could also hint at additional easing amid the ongoing pandemic situation in the US. The announcement will include fresh economic projections, and any downgrade there may further pressure the greenback.”

“The USD/JPY pair has room to extend its decline, trading near this year’s low at 103.17. The 4-hour chart shows that the 20 SMA has extended its decline below the larger ones, now around 103.85. Technical indicators head lower within negative levels, in line with further slides, to be confirmed on a break below the mentioned low.”