Today we would take a look at the USD/JPY pair. The pair suffered a big drop at the end of last week and now continues to trade under the 110 level.
While there are no internal factors pointing in the direction of a strengthening in the Japanese yen, the JPY has been able to make gains as one of the most popular safety assets. Lately investors have been apprehensive due to the falling through of the trade negotiations between the United States and China. The world’s two leading economies seem unable to set aside their differences and are now far from reaching a trade agreement.
The American dollar recently weakened slightly on account of lukewarm fundamental reports. Many investors seem confident that this year the Federal Reserve will have to cut the interest rate in order to support the American economy as the trade war and the global economic slowdown catch up with it. While there has been no indication from the Federal Reserve that this would happen, the markets remain shaky.
In terms of the daily chart, we have a pivot point for the pair located at 109.49. The support levels lie at 109.40 and 109.27, while the resistances are located at 109.62 and 109.71. The indicators of technical analysis are confident in recommending us a strong sell position.
